To determine how much Joe and Melinda can expect to pay in premiums the first year for their life insurance policies, let's follow these steps:
### Step 1: Determine Joe's Annual Premium
- Joe is 32 years old and wants a 15-year term policy.
- Joe wants a [tex]$300,000 policy.
From the table, the annual premium rate for a 32-year-old male with a 15-year term policy is $[/tex]3.32 per [tex]$1,000 of face value.
Face value = $[/tex]300,000
First, we need to determine how many thousands of dollars there are in the face value:
[tex]\[
\text{Face Value in thousands} = \frac{300,000}{1,000} = 300
\][/tex]
Now, use the annual premium rate to find Joe's annual premium:
[tex]\[
\text{Joe's Annual Premium} = 300 \times \$3.32 = \$996.00
\][/tex]
### Step 2: Determine Melinda's Annual Premium
- Melinda is 29 years old and wants a 20-year term policy.
- Melinda wants a [tex]$300,000 policy.
From the table, the annual premium rate for a 29-year-old female with a 20-year term policy is $[/tex]4.96 per [tex]$1,000 of face value.
Face value = $[/tex]300,000
Determine how many thousands of dollars there are in the face value:
[tex]\[
\text{Face Value in thousands} = \frac{300,000}{1,000} = 300
\][/tex]
Now, use the annual premium rate to find Melinda's annual premium:
[tex]\[
\text{Melinda's Annual Premium} = 300 \times \$4.96 = \$1,488.00
\][/tex]
### Step 3: Calculate Total Annual Premium
The total annual premium that Joe and Melinda will pay is the sum of Joe's and Melinda's annual premiums:
[tex]\[
\text{Total Annual Premium} = \text{Joe's Annual Premium} + \text{Melinda's Annual Premium}
\][/tex]
Substitute the values obtained:
[tex]\[
\text{Total Annual Premium} = \$996.00 + \$1,488.00 = \$2,484.00
\][/tex]
### Conclusion
Joe and Melinda can expect to pay a total of \[tex]$2,484 in premiums the first year.
So, the correct answer is:
b. \$[/tex]2,484
