Solution-Which option would recommend that brent exercise

Which option would recommend that brent exercise

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Reference no: EM132727279

Julia Baker died, leaving to her husband Brent an insurance policy contract that provides that the beneficiary (Brent) can choose any one of the following four options.

(a) $55,000 immediate cash.
(b) $4,000 every 3 months payable at the end of each quarter for 5 years.
(c) $18,000 immediate cash and $1,800 every 3 months for 10 years, payable at the beginning of each 3-month period.
(d) $4,000 every 3 months for 3 years and $1,500 each quarter for the following 25 quarters, all payments payable at the end of each quarter.

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Problem 1: If money is worth 21⁄2% per quarter, compounded quarterly, which option would you recommend that Brent exercise?

Reference no: EM132727279

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Which option would recommend that brent exercise

Reference no: EM132727279

Reference no: EM132727279

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