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Determining the Cost of Insurance. Suppose you are 45 and have a $10,000 face amount 15-year, limited payment, participat- ing policy (dividends will be used to build up the cash value of the policy). Your annual premium is $350. The cash value of the policy is expected to be $4,000 in 15 years. Using time value of money and assuming you could invest your money elsewhere for a 7 percent annual yield, calculate the net cost of insurance.

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Financial Management, Finance

Category:- Financial Management
Reference No.:- M92718203

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