ACCT 231 Annuity Product Deal Activity Presentation

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djrejuus

Business Finance

ACCT 231

ACCT

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Topic B: Your friend Beatrice is 20 years old and is currently in her 2B term of a science program at UW - she has taken calculus classes (for science students) at UW but doesn't have any background in financial mathematics. She has just won a significant amount in a lottery and she has decided to use the full amount to purchase a level annuity. Today, she is visiting her investment advisor at Big Bank Canada to make the purchase. She feels anxious about going to her advisor because she's "not great at math and overwhelmed by numbers". She only understands the very basics of an annuity: “I just know that I pay an amount upfront and then receive a periodic payment for the term of the annuity." She has 5 minutes of free time before her meeting with the advisor. She says: "The advisor is going to provide me with several options for annuity products. These options will differ in 3 ways: the term of the annuity, the frequency of payments (either weekly, monthly, or yearly), and the amount of the payment. How do I know which annuity product is the best deal? I've heard that sometimes the best choice for me will depend on my personal financial situation - how should that factor into my decision making?" You will be evaluated on how well you prepare Beatrice to make the optimal choice among the options that she'll be offered. Keywords your explanation should address: frequency of payments, payment amount, term, interest rate Submission requirements You must submit a file that: • Is a narrated PowerPoint file o You must use the newest version of Power Point by downloading Office 365 onto your PC or Mac. It is free to all UW students here. If you use an older version or the web version of PowerPoint, you risk submitting a file that cannot be graded (e.g., a file generated by an older version may not play on another student's computer, even though it plays on yours.) . Has a maximum length of 5 minutes . Has a maximum of two slides (you do not need a title slide) . Has no animation. . Has a pptx file format and size no larger than 7MB.
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Explanation & Answer

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Annuity Product Deal

•Understand terms of contract.
•Identify payment streams.
•Initial and annual fees.
•Fees paid on investment.
•Determine frequency of pa...


Anonymous
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