Calculating Present Valu
Using TVM Calculation,
PV = BEG[FV = 0, PMT = 650, N = 4, I = 0.10]
PV = $1,394.74
How much a four year annuity of $650 annual payments. (occured at the beginning of each...
... Amatir nart How much a four year annuity of $650 annual payments - Coccured at the beginning of each year) is worth today? Assuming the interest rate is 10%. $2,914,67 $2,499.85 11,394.74 # 650 (1 + 10/100)^3+650 $1,166,2or V$ 9, 266.45 and expected ca
You are computing the future value of an ordinary annuity with annual payments of $650 each for four years. The annuity interest rate is 4 percent. The future value of each one of these four payments at the end of year 4 is:
You are computing the future value of an ordinary annuity with annual payments of $650 each for four years. The annuity interest rate is 4 percent. The future value of each one of these four payments at the end of year 4 is:
7. Present value of annuities and annuity payments Aa Aa The present value of an annuity is the sum of the discounted value of all future cash flows. You have the opportunity to invest in several annuities. Which of the following 10-year annuities has the greatest present value (PV)? Assume that all annuities earn the same positive interest rate. An annuity that pays $1,000 at the end of each year An annuity that pays $1,000 at the beginning of each...
12. Present value of annuities and annuity payments Aa Aa The present value of an annuity is the sum of the discounted value of all future cash flows. You have the opportunity to invest in several annuities. Which of the following 10-year annuities has the greatest present value (PV)? Assume that all annuities earn the same positive interest rate. O An annuity that pays $500 at the end of every six mońths O An annuity that pays $1,000 at the...
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Annuity A makes annual payments of $813.73 for each of the next 10 years, while annuity B makes annual payments of $500 per year forever. At what interest rate would you be indifferent between the two? At interest rates above/below this break-even rate, which annuity would you choose?
Annuity A makes annual payments of $813.73 for each of the next 10 years, while annuity B makes annual payments of $500 per year forever. At what interest rate would you be indifferent between the two? At interest rates above/below this break-even rate, which annuity would you choose?