9. Examine the time line for the annuity shown. 250 (1.015) 250 (1.015) 250 (1.015) 250 (1.015)23 250 (1.015) a) What is the duration of this annuity? How can you tell? b) Determine the annual rate of interest and the number of compounding periods per year. c) Determine the present value of this annuity. Time (3-month periods) Now 1 2 3 23 24 +H 250 250 250 250 250

9. Examine the time line for the annuity shown. 250 (1.015) 250 (1.015) 250 (1.015) 250 (1.015)23 250 (1.015) a) What is the duration of this annuity? How can you tell? b) Determine the annual rate of interest and the number of compounding periods per year. c) Determine the present value of this annuity. Time (3-month periods) Now 1 2 3 23 24 +H 250 250 250 250 250

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

Give typing answer with explanation and conclusion
Find the term of the following ordinary general annuity. State your answer in years and months (from 0 to 11 months). Payment Interval Present Periodic Interest Compounding Period Value Payment Rate $9300 $355 month 7% quarterly The term of the annuity is year(s) and month(s).
If the present value of an ordinary, 6-year annuity is $6400 and interest rates are 2.5 percent, what’s the present value of the same annuity due? (Round your answer to 2 decimal places.) Present value $
An annuity-immediate has 28 payments of $200 per period. The effective rate of interest per period is 6% for the first 12 periods and 3% for the following 16 periods. (A) Find the accumulated value of the annuity. Round your answer to 2 decimal places. (B) Find the present value of the annuity. Round your answer to 2 decimal places.
Estimating the annual interest rate with an ordinary annuity. Fill in the missing annual interest rates in the following table for an ordinary annuity stream: Number of Payments or Years 10 19 25 80 Annual Interest Rate % (Round to two decimal places.) % (Round to two decimal places.) % (Round to two decimal places.) % (Round to two decimal places.) Future Value $0.00 $12,286.30 $0.00 $1,435,078.21 C Annuity Present Value $580.00 $444.01 $1,985.57 $450.00 $2,298.49 $0.00 $37,000.00 $0.00
In the provided formulas, P is the deposit made at the end of each compounding period, r is the annual interest rate of the annuity in decimal form, n is the number of compounding periods per year, and A is the value of the annuity after t years. Periodic Deposit $1500 at the end of every three months Rate 7.25% compounded quarterly Time…
Find the term of the following ordinary general annuity. State your answer in years and months (from 0 to 11 months). Present Periodic Payment Interval Interest Compounding Period Value Payment Rate $10,300 $330 month 3% semi-annually The term of the annuity is year(s) and month(s).
Estimate the interest earned by an annuity for each time period. i) 2 years: _____ ii) 14 years: _____ iii) 22 years: _____
16.Find i (the rate per period) and n (the number of periods) for the following annuity. Monthly deposits of $345 are made for 7 years into an annuity that pays 7% compounded monthly. i= n= I resubmit mi question, but the notes its complete...
I need help with these two question 9) Find the effective rate corresponding to the given nominal rate. (Use a 365-day year. Round your answer to two decimal places.) 2%/year compounded quarterly %/year 10)Suppose payments will be made for 9 1/4years at the end of each month from an ordinary annuity earning interest at the rate of 2.25%/year compounded monthly. If the present value of the annuity is $43,000, what should be the size of each payment from the annuity? (Round your answer to the nearest cent.)
Give typing answer with explanation and conclusion Determine the periodic payment for the following deferred annuity. The annuity is an ordinary annuity following the period of deferral. Deferral period Payment interval (months) Interest rate (%) Compounding frequency Term (years) Present value ($) 27 months 1 6.4 Quarterly 20 50,000.00
An annuity-immediate has 21 payments of $800 per period. The effective rate of interest per period is 7% for the first 9 periods and 4% for the following 12 periods. (A) Find the accumulated value of the annuity. Round your answer to 2 decimal places.(B) Find the present value of the annuity. Round your answer to 2 decimal places.