Louise receives a series of annual payments that start at $1,000 and decrease by $100 each...

Louise receives a series of annual payments that start at $1,000 and decrease by $100 each year

down to $100, then increase again by $100 each year back up to $1,000 and then the payments

stop. Assume that payments begin immediately and that the annual effective interest rate is

i

= 9%

.

Determine the present value of this series of payments.

Please help! I am really stuck. Thank you!

Expert Solution

NPV Formula in excel= =NPV(rate, 900,800,700,....1000) +1000

		Year0	Year1	Year2	Year3	Year4	Year5	Year6	Year7	Year8	Year9	Year10	Year11	Year12	Year13	Year14	Year15	Year16	Year17	Year18

		1,000	900	800	700	600	500	400	300	200	100	200	300	400	500	600	700	800	900	1,000
RATE	9%

npv	5,837.84

jeff jeffy answered 1 year ago

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