What is the present value of the following annuity? $759 every year at the end of...

What is the present value of the following annuity?

$759 every year at the end of the year for the next 6 years, discounted back to the present at 17.51 percent per year, compounded annually?

Expert Solution

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

	Here,

A	Interest rate per annum	17.51%
B	Number of years	6
C	Number of compoundings per per annum	1
A÷C	Interest rate per period ( r)	17.51%
B×C	Number of periods (n)	6
	Payment per period (P)	$ 759

	Present value of annuity	$ 2,688.37
		759×(1-(1÷(1+17.51%)^6))÷17.51%

jeff jeffy answered 2 years ago

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