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A future value of an ordinary annuity stream of $185 periodic payment per year is $982.19...

A future value of an ordinary annuity stream of $185 periodic payment per year is $982.19 when valued at a 3% rate. Approx. how much would the future value change if this is annuity due & the new interest rate is now at 4%?

A. increase of $40.45

B. decrease of $29.47

C. increase of $39.50

D. decrease of $40.45

E. increase of $59.99

Solutions

Expert Solution

Note - Ordinary due means invested at end of the period where as annuity due means invested at the beginning of the period

Please upvote if the ans is helpful.In case of doubt,do comment.Thanks.

jeff jeffy answered 1 year ago
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