Solve the problem.After retirement, Kelly's company offers her two options for receiving her retirement pension. According the the first plan, she will receive monthly payments from a variable annuity that initially pays $700 per month then decreases each month at a rate of $25 per month per year. Optionally, she may choose a plan that pays her a fixed amount of $500 per month for the rest of her life. The monthly payments for the two plans are illustrated in the graph below. If Kelly's remaining life expectancy is 20 years, which plan would be the better choice?

A. The fixed annuity
B. The variable annuity
C. Both plans are equally attractive.


Answer: A

Mathematics

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