Annie receives an annuity of $45,000, payable once every 3 years for the next 21 years....

Annie receives an annuity of $45,000, payable once every 3 years for the next 21 years. The first payment occurs exactly 3 years from today. The required rate of return is 5%. Calculate the present value of this annuity. (Round to 2 decimals)

Expert Solution

present value of this annuity is $183,014.08
Statement showing Cash flows
Particulars	Time	PVf 5%	Amount	PV
Cash inflows	3.00	0.8638	45,000.00	38,872.69
Cash inflows	6.00	0.7462	45,000.00	33,579.69
Cash inflows	9.00	0.6446	45,000.00	29,007.40
Cash inflows	12.00	0.5568	45,000.00	25,057.68
Cash inflows	15.00	0.4810	45,000.00	21,645.77
Cash inflows	18.00	0.4155	45,000.00	18,698.43
Cash inflows	21.00	0.3589	45,000.00	16,152.41
PV of Cash Inflows =PVCI				183,014.08

jeff jeffy answered 1 year ago

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