Question

What is the present value of the following series of payments: $112 made at the end of every year starting in year 1 and ending in year 19 EXCEPT there will be no payment of any kind at the end of year 14? The interest is 4.9% annual rate compounded annually.

Answer 1

Year	Cash Flow	PV @ 4.9%	Present Value
1	$112.00	0.9533	$106.77
2	$112.00	0.9088	$101.78
3	$112.00	0.8663	$97.03
4	$112.00	0.8258	$92.49
5	$112.00	0.7873	$88.17
6	$112.00	0.7505	$84.06
7	$112.00	0.7154	$80.13
8	$112.00	0.6820	$76.39
9	$112.00	0.6502	$72.82
10	$112.00	0.6198	$69.42
11	$112.00	0.5908	$66.17
12	$112.00	0.5632	$63.08
13	$112.00	0.5369	$60.14
14	$0.00	0.5119	$0.00
15	$112.00	0.4879	$54.65
16	$112.00	0.4651	$52.10
17	$112.00	0.4434	$49.66
18	$112.00	0.4227	$47.34
19	$112.00	0.4030	$45.13
		Present Value	$1,307.33