Calculate the net cost of insurance

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Reference no: EM132913012

Problem 1: Suppose you are 46 and have a $430,000 face amount, 14-year, limited-payment, participating policy (dividends will be used to build up the cash value of the policy). Your annual premium is $1,505. The cash value of the policy is expected to be $17,200 in 14 years. Using time value of money and assuming you could invest your money elsewhere for a 8 percent annual yield, calculate the net cost of insurance.

Reference no: EM132913012

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