Dear student, only one question is allowed at a time. I am answering the first question
17)
Present value of annuity
= P x [ 1 – ( 1 + r ) ^ -n] / r
Where,
P = Periodic payment = $500
r = Rate of interest = 14% or 0.14
n = Number of years = 42
So, Present Value
= $500 x [ 1 – ( 1.14 ^ - 42)] / 0.14
= $500 x [ 1 - 0.004074] / 0.14
= $500 x 7.113757
= 3,556.88
(USLUR 17 .points) What is the present value of an annuity of $500 per year (first...
please show work!!
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A person wants to establish an annuity for retirement. He wants
to make quarterly deposits for
years so that he can then make quarterly withdraws of
for
years. The annuity earns
% compounded quarterly.
(a) How much will have to be in the account at the time he
retires?
Value of account at retirement:
[Note: Your answer is a dollar amount and should have a dollar sign
and exactly two decimal places.]
(b) How much should be deposited each quarter...
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