What’s the interest rate of a 10-year, annual $3,200 annuity with present value of $20,000? (Use...

What’s the interest rate of a 10-year, annual $3,200 annuity with present value of $20,000? (Use a time value of money calculator or a spreadsheet. Round your answer to 2 decimal places.)

PVIFA(x% , 6 years) = 20,000/3,200

x = ?

Solutions

Expert Solution

Hence, Interest rate is 9.61%

jeff jeffy answered 2 years ago

Next > < Previous

Related Solutions

Assume a 10% annual interest rate. (i) What is the present value of a 25 year,...

Assume a 10% annual interest rate. (i) What is the present value of a 25 year, $900 annuity if the first payment does not occur until 7 years from today? (ii) What would be the present value of a perpetuity with the same characteristics ($900, first payment in 7 six years).

An annuity in perpetuity with effective annual interest rate i > 0 has present value $90....

An annuity in perpetuity with effective annual interest rate i > 0 has present value $90. The annuity pays $30 at the end of each 5 year period, with the first payment at the end of year 10. Find i. please dont solve using excel

What is the present value of a $100-payment, 100-year annuity due if the interest rate is...

What is the present value of a $100-payment, 100-year annuity due if the interest rate is 14% per year? What is the future value of a $50-payment, 50-year annuity due if the interest rate is 9% per year?

The present value of $20,000 to be received in 5 years at an interest rate of...

The present value of $20,000 to be received in 5 years at an interest rate of 16%, compounded annually, is $9,522.Required:Using a present value table (Table 6-4 and Table 6-5), calculate the present value of $20,000 for each of the following items (parts a—f) using these facts: (Use the appropriate value(s) from the tables provided. Round your PV factors to 4 decimal places and final answers to the nearest whole dollar.)a. Interest is compounded semiannually. b. Interest is compounded quarterly....

For an interest rate of 3% compounded monthly, find the present value of an annuity of...

For an interest rate of 3% compounded monthly, find the present value of an annuity of $129 at the end of each month for 5 months and $259 thereafter at the end of each month for further 1 years. Round your answer to TWO decimals. The present value of the annuity=

Present value of an annuity Consider the following case. Amount of annuity Interest rate Period (years)...

Present value of an annuity Consider the following case. Amount of annuity Interest rate Period (years) $44,000 12% 13 a. Calculate the present value of the annuity assuming that it is (1) An ordinary annuity. (2) An annuity due. b. Compare your findings in parts a(1) and a(2). All else being identical, which type of annuity—ordinary or annuity due—is preferable? Explain why. The present value of the ordinary annuity is____. (Round to the nearest cent.)

Find the accumulate value at the end of year 10 of a 10-year annuity with annual...

Find the accumulate value at the end of year 10 of a 10-year annuity with annual payments which pays $1000 in one year and each subsequent payment is 3% less than the preceding payment. The annual effective rate of interest is 5%. An annuity immediate has semiannual payments with arithmetic progression of 800, 750, 700, . . . , 350, at i(2) = 0.16. Find the future value of this annuity 3 years after the last payment.

What is the present value of $10,000 per year in perpetuity at an annual interest rate of 10 percent if the perpetuity starts in year=4?

What is the present value of $10,000 per year in perpetuity at an annual interest rate of 10 percent if the perpetuity starts in year=4? $10,000 $75,131.48 $1,000 $68,301.35 $82,402.36

Consider a level annuity-due with annual payments, and an annual interest rate of 6%. The value...

Consider a level annuity-due with annual payments, and an annual interest rate of 6%. The value of the annuity-due, on the day of its first payment, is $5,231.50. Using the same interest rate, the value of this annuity on the day of its last payment, is $16,778.13. Find the number of payments and the amount of the level payment for this annuity.

What is the present value of a five-period annuity of $3,000 if the interest rate per...

What is the present value of a five-period annuity of $3,000 if the interest rate per period is 12% and the first payment is made today? Three thousand dollars is deposited into an account paying 10% annually to provide three annual withdrawals of $1,206.34 beginning in one year. How much remains in the account after the second payment has been withdrawn? You will be receiving cash flows of: $1,000 today, $2,000 at end of year 1, $4,000 at end of...

Subjects