Present Value=Annuity × Present Value Annuity factor(n,r)
Where n=period;r=required rate
Here as the amount is constant $6000 every year, we can use the above formula to find out its present value.
Present Value
=$6000×Present Value Annuity factor(8,10%)
=$6000×5.33492619783
=$32010
Knowledge Check 01 What is the present value of $6,000 to be paid at the beginn...
8.33 Knowledge Check 01 What is the present value of $6,000 to be paid at the end of each of the next eight periods assuming an interest rate of 10%? Multiple Choice O O $35.21 O $75,477 O $68.65 O $32.010 < Prev 1 2 Next >
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