Hi, quick question regarding the model solution given for this question. The annuity a(60) payable monthly [i.e. with (12) superscript] is used at the start of the question, but when the values are plugged in from the tables the -11/24 approximation I was expecting for the (12) was not used (although it was in the denominator). Can anybody please explain why this is the case? Many thanks, Jooser
I think it's just because you've got a subtraction going on (to calculate the reversionary annuity) and the -11/24 approximation from the first term (single life annuity) cancels with the -(-11/24) approximation from the second (joint life annuity).
