Rate of Return of an Annuity: Your Uncle's Offer
Assume that you own an annuity that will pay you $15,000 per year for 12 years, with the first payment being made today. You need money today to start a new business, and your uncle offers to give you $120,000 for the annuity. If you sell it, what rate of return would your uncle earn on his investment?
A. 6.85 %
C. 7.59 %
D. 7.99 %
E. 8.41 %.
Please show the calculation.© SolutionLibrary Inc. solutionlibary.com July 12, 2020, 1:35 am 9836dcf9d7 https://solutionlibrary.com/business/finance/rate-of-return-of-an-annuity-your-uncles-offer-f4mj