a. Use the appropriate formula to find the value of the annuity.b. Find the interest.Periodic DepositRate$2000 at the end of every three months 6.25% compounded quarterlyClick the icon to view home finance formulas.Time6 years

Annuity is a contract under which a person agrees to pay a fixed amount at a fixed interval of time.

Answered: a. Use the appropriate formula to find…

Business

Accounting

a. Use the appropriate formula to find the value of the annuity. b. Find the interest.

Pfin (with Mindtap, 1 Term Printed Access Card) (mindtap Course List)

7th Edition

ISBN:9780357033609

Author:Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk

Publisher:Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk

Chapter7: Using Consumer Loans

Section: Chapter Questions

Problem 6FPE

See similar textbooks

Related questions

Q: What are the primary characteristics of an annuity? Differentiate between an “ordinary annuity” and…

A: Annuity: In the realm of finance, an annuity is a series of recurring payments. Annuities include…

Q: Compute the present value of an ordinary annuity, an annuity due, and a deferred annuity.

A: Computation of the present value (PV) of an ordinary annuity can be done by using the…

Q: what is an annuity? Provide an example

A: Annuity is an important concept in finance especially in the context of time value of money. Annuity…

Q: Grace borrowed P150,000 payable in 2 years. To repay the loan, she must pay an amount every month…

A: The PMT function is a type of financial function which helps to determine the total monthly payment…

Q: Which of the following cannot be calculated? Select one: a. the interest rate on perpetuity given…

A: Perpetuity is referred to as an annuity, which does not have an end or the stream of the cash…

Q: What does the annuity factor indicate?

A: Annuity factor It indicates the discounted factor’s sum for all the n maturities when all n…

Q: What are the primary characteristics of an annuity? Differentiate between an “ordinary annuity” and…

A: Annuity represents a series of equal amount of payment / receipt made on particular interval for a…

Q: Discuss the present value of an annuity due with an example

A: Present value of an annuity An Annuity is a stream of regular periodic payments made or received for…

Q: The process that determines the present value of a single payment or stream of payments to be…

A: Annuity means regular payment to be received from an investment.

Q: e. What is an annuity due? How does this differ from an ordinary annuity

A: Annuity refers to a series of equal payments made at the same interval.

Q: Derive the formula

A: Future worth or Future value refers to the value of current asset at some future point of time on a…

Q: How do I determine the present value of an annuity by single computation?

A: The capital is the backbone of the company, and the company will be willing to raise the capital for…

Q: Annual payments of 105,000 with interest rate of 12% compounded annually for 5 years. Find the…

A: Annuity: The amount accumulated by periodic deposits is known as an annuity. The future value of a…

Q: Explain the difference between an ordinary annuity and an annuity due situation.

A: Annuity: It is amount of money payable to an individual at a periodic basis which is normally a…

Q: What is the formula in finding the present value of a deferred annuity

A: Deferred annuity is a type of contract which pays the purchaser a periodic payment or an lump sum…

Q: From the table below, answer comprehensively the following subparts: a. Which plan do you prefer?…

A: Here we can use the concepts and formulas of compounding and time value of money.

Q: Can someone give an example of the following: 1. Ordinary Annuity 2. Annuity due

A: An annuity refers to a fixed stream of payments made at equal intervals. These are created and sold…

Q: Miss Shirly wants to deposit P18.000 semi annually in a fund that pays 5% compounded semi- annually.…

A: In order to accumulate a higher amount in the future regular deposits are made in the fund. The…

Q: Present value of an annuity Consider the following cases. Case Annuity payment A B C D E $ 12,000…

Q: Define Annuity.

A: Definition: Present value: This is the amount of future value reduced or discounted at a rate of…

Question

a. Use the appropriate formula to find the value of the annuity.
b. Find the interest.
Periodic Deposit
Rate
$2000 at the end of every three months 6.25% compounded quarterly
Click the icon to view home finance formulas.
Time
6 years

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1: Introduction

VIEW

Step 2: Computation of Future Value of Annuity

VIEW

Step 3: Computation of Interest Portion

VIEW

Solution

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 4 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

a. Use the appropriate formula to find the value of the annuity. b. Find the interest. Periodic Deposit $50 at the end of each month Rate 5% compounded monthly Click the icon to view some finance formulas. Time 10 years
a. Use the appropriate formula to find the value of the annuity. b. Find the interest. Periodic Deposit Rate $1500 at the end of every three months 5.75% compounded quarterly Click the icon to view some finance formulas. Time 8 years a. The value of the annuity is $ (Do not round until the final answer. Then round to the nearest dollar as needed.)
a. Use the appropriate formula to find the value of the annuity. b. Find the interest. Periodic Deposit Rate 6% compounded monthly Time 15 years $40 at the end of each month A Click the icon to view some finance formulas. a. The value of the annuity is $ (Do not round until the final answer. Then round to the nearest dollar as needed.) b. The interest is $. (Use the answer from part (a) to find this answer. Round to the nearest dollar as needed.)
a. Use the appropriate formula to find the value of the annuity. b. Find the interest. Periodic Deposit $8000 at the end of each year Time 35 years Rate 4% compounded annually Click the icon to view some finance formulas. .... a. The value of the annuity is $ (Do not round until the final answer. Then round to the nearest dollar as needed.) Formulas 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. nt |+ A P[(1 + n* - 1] - 1 A = A = P = r nt Print Done
a. Use the appropriate formula to find the value of the annuity. b. Find the interest. Time 20 years Rate Periodic Deposit $1000 at the end of each year 3% compounded annually
Use the appropriate formula to find the value of the annuity. b. Find the interest. Periodic Deposit Rate Time $30 at the end of each month 5% compounded monthly 10 years
- a. Use the appropriate formula to find the value of the annuity. b. Find the interest. Periodic Deposit Rate $1500 at the end of every three months 5.25% compounded quarterly Click the icon to view some finance formulas. Time 7 years a. The value of the annuity is $. (Do not round until the final answer. Then round to the nearest dollar as needed.) b. The interest is $ (Use the answer from part (a) to find this answer. Round to the nearest dollar as needed.) Time
Find the amount accumulated FV in the given annuity account. (Assume end-of-period deposits and compounding at the same intervals as deposits. Round your answer to the nearest cent.) $2,200 is deposited quarterly for 20 years at 3% per year FV = $ Need Help? Read It Watch It Submit Answer
a. Use the appropriate formula to find the value of the annuity b.how much of the financial goal comes from deposit and how much comes from interest? periodic deposit-$? at the end of the month Rate-5% compounded monthly Time-16 years Financial goal-$140,000
Find the amount accumulated FV in the given annuity account. (Assume end-of-period deposits and compounding at the same intervals as deposits. Round your answer to the nearest cent.) $200 is deposited monthly for 10 years at 6% per year in an account containing $9,000 at the start FV = $ 49150 Need Help? Read It Watch It Submit Answer
i would like to know the anuity for each year.
a. Use the appropriate formula to find the value of the annuity. b. Find the interest. Periodic Deposit $90 at the end of every six months Rate Time 4.5% compounded semiannually 35 years