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OF DR S U A = a Ass... - Saved. QSearch in Document Share Comm Insert Draw Design Layout References Calibri (Bo... v 11 A A A


toSave OFF DE S U A = Ass... - Saved... Qu Search in Document he Insert Draw Design Layout References Share D Comments Mailin
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Answer #1

FV of Annuity =CF [ (1+r)^n - 1 ] /r

r is int rate per anum

n is time period

$ 2,000,000 = CF [ (1+0.05)^25 - 1 ] / 0.05

$ 2,000,000 = CF [ (1.05)^25 - 1 ] / 0.05

$ 2,000,000 = CF [ 3.3864 - 1 ] / 0.05

$ 2,000,000 = CF [ 2.3864 ] / 0.05

CF = $ 2,000,000 * 0.05 / 2.3864

= $ 41,904.91

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