Present Value of an Annuity What is the present value of a $400 annuity payment over...

Present Value of an Annuity What is the present value of a $400 annuity payment over 6 years if interest rates are 9 percent?

$670.84

$2,013.18

$238.51

$1,794.37

Expert Solution

	Present value of annuity	P×[1-(1÷(1+r)^n)]÷r

	Here,

1	Interest rate per annum	9.00%
2	Number of years	6
3	Number of compoundings per per annum	1
4 = 1÷3	Interest rate per period ( r)	9.00%
5 = 2×3	Number of periods (n)	6
	Payment per period (P)	$ 400

	Present value of annuity	$ 1,794.37
		400*[1-(1/(1+9%)^6]/9%

jeff jeffy answered 1 year ago

the present value of an annuity for 2 years, with the first payment at the end...

the present value of an annuity for 2 years, with the first payment at the end of 10 years is 40,239 pesos. If money is worth 4.94%, what is the value of an annuity for 5 years?

PRESENT VALUE OF AN ANNUITY - (a) What is the present value of an asset that...

PRESENT VALUE OF AN ANNUITY - (a) What is the present value of an asset that pays $10,000 per year at the end of the next four years if the appropriate discount rate is 5 percent? What total return would you earn if you bought this asset and it paid its expected cash flows on time each year for the next four years? Prove that you earned the same return that you would have, had you put your money in...

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?

Calculate the annual cash flows (annuity payments) from a fixed-payment annuity if the present value of...

Calculate the annual cash flows (annuity payments) from a fixed-payment annuity if the present value of the 25-year annuity is $1.9 million and the annuity earns a guaranteed annual return of 13 percent. The payments are to begin at the end of seven years.

6. Calculating Annuity Values. For each of the following annuities, calculate the present value. Annuity Payment...

6. Calculating Annuity Values. For each of the following annuities, calculate the present value. Annuity Payment Years Interest Rate $2,100 7 5% 1,095 9 10% 11,000 18 8% 30,000 28 14%

What is the future value of a $600 annuity payment over five years if interest rates...

What is the future value of a $600 annuity payment over five years if interest rates are 6 percent? (Do not round intermediate calculations. Round your final answer to 2 decimal places.)

"What is the future value of an ordinary $1,000 annuity payment over six years if interest...

"What is the future value of an ordinary $1,000 annuity payment over six years if interest rates are 6% (assume annual compounding)?" "$6,000.00 " "$6,975.32 " "$4,917.32 " "$9,675.32 " Not possible to compute with the data provided

Find the periodic payment for the following simple annuity due. Future Value $21,200 Present Value _________?...

Find the periodic payment for the following simple annuity due. Future Value $21,200 Present Value _________? Payment Period 1 month Term of Annuity 10 years Interest Rate 11% Conversion Period monthly The periodic payment is $______ . (Round the final answer to the nearest cent as needed. Round all intermediate values to six decimal places as needed.)

1. Find the following values assuming a regular, or ordinary, annuity: The present value of $400...

1. Find the following values assuming a regular, or ordinary, annuity: The present value of $400 per year for ten years at 10 percent The future value of $400 per year for ten years at 10 percent The present value of $200 per year for five years at 5 percent The future value of $200 per year for five years at 5 percent

what is the relationship between the present value factor and the annuity present value factor

Question