What is the PV of an ordinary annuity with 10 payments of $2.700 if the appropriate...

Question

Question

Answer 1

Answer #1

Answer : c

Explanation

Present Value of Annuity = Annual Payment * [PVIFA (PIR, Period)]

= 2700 * 7.18883

= 19409.84

Where,

Annual Payment = $2700

PIR (Interest Rate) = 6.5%

Period = 10

[PVIFA (6.5% , 10 )] = 7.18883

Working Note :

Calculation of [PVIFA (6.5% , 10 )]

Answer 2

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