"ORDINARY DEFERRED ANNUITY: SETTING UP A RETIREMENT FUND. An ANNUITY is a series of equal payments made at equal intervals. ANNRATE% is the nominal annual interest rate. NUMYEARS is the term in years starting at first payment. DEFYEARS is the number of deferred years before the first payment. The payment interval is every month. PERPAYMN is the monthly payment. PRESVALU is annuity's value today which may be considered its purchase price. *** Answers to Problem *** (a) Variables are set to proper values at entry. Mr Lew must pay $24,692.54 today if he is to receve $1,000 per motn at age 65. If he can find a 9% rate from some investment then his cost drops to $13,142.76. Type any key to exit. (c) PCSCC, Inc., 1993 || Mr. Lew has just turned 40. He wants to set up a retirement fund which will pay him a monthly income of $1,000 begining at age 65 and continuing each month for 20 years, his projected life span. Money is worth 7% effective. (a) How much will it cost him to purchase this deferred annuity? Type comma key to see answers. Type (F2) to return to help file."
