Question

After getting married, Joe, 32, and Melinda, 29, decide to take out life insurance policies. Joe would like a 15-year term policy and Melinda would like a 20-year term policy. They each want a $300,000 policy. How much can Joe and Melinda expect to pay in premiums the first year? For age 32, a male 15-year term policy is $3,320 and a 20-year term policy is $5,450. For age 29, a female 15-year term policy is $2,580 and a 20-year term policy is $4,960. What is the total premium amount that Joe and Melinda will pay in the first year?

1) $2,478
2) $2,484
3) $1,488
4) $2,409

Answer 1

The total premium amount that Joe and Melinda will pay in the first year for their life insurance policies is $8,280. This calculation is based on Joe's chosen 15-year term policy, which costs $3,320 per year, and Melinda's chosen 20-year term policy, which costs $4,960 per year. The option is not appropriate with the answer.

Step-by-step explanation:

Judging from the provided information, we can calculate the total premium amount that Joe and Melinda will pay in the first year for their life insurance policies. According to the data, a 32-year-old male looking for a 15-year term policy would pay a premium of $3,320. However, since Joe wants a 15-year term and Melinda wants a 20-year term, we will use the rates corresponding to their respective choices.

For Joe, the 15-year term policy at age 32 costs: $3,320 per year.

For Melinda, the 20-year term policy at age 29 costs: $4,960 per year.

To obtain the total amount Joe and Melinda will pay in premiums the first year, we add these amounts together:

Total premium = Joe's premium + Melinda's premium
Total premium = $3,320 + $4,960
Total premium = $8,280

Therefore, none of the provided options (1) $2,478, (2) $2,484, (3) $1,488, (4) $2,409 are correct. The correct amount that Joe and Melinda will pay in the first year is $8,280.