Answer:
Worth of Insurance settlement $426.5
Explanation:
Present value of Insurance settlement = P [ ( 1 - ( 1+r )^-n ) / r ]
Present value of Insurance settlement = 50 [ ( 1 - ( 1 + 3% )^-10 ) / 3%]
Present value of Insurance settlement = 50 [ ( 1 - ( 1 + 0.03 )^-10 ) / 0.03]
Present value of Insurance settlement = 50 [ ( 1 - ( 1 .03 )^-10 ) / 0.03]
Present value of Insurance settlement = 50 [ ( 1 - ( 1 .03 )^-10 ) / 0.03]
Present value of Insurance settlement = 50 [ ( 1 - 0.7441 ) / 0.03]
Present value of Insurance settlement = 50 [ 0.2559 / 0.03]
Present value of Insurance settlement = 50 x 8.53
Present value of Insurance settlement = 426.5
