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Future value of an ordinary annuity. Fill in the missing future values in the following table for an ordinary annuity: E Number of Annual Payments or Present Value Annuity Future Value Interest Rate Years 6 8% $325.83 (Round to the nearest cent.) i Data Table (Click on the following icon 9 in order to copy its contents into a spreadsheet.) Number of Annual Payments or Present Value Annuity Future Value Interest Rate Years 6 8% $325.83 ? 17 13% $1,312.26 $673.87 ? 26 2% 320 0.7% $425.77 %24

Future value of an ordinary annuity. Fill in the missing future values in the following table for an ordinary annuity: E Number of Annual Payments or Present Value Annuity Future Value Interest Rate Years 6 8% $325.83 (Round to the nearest cent.) i Data Table (Click on the following icon 9 in order to copy its contents into a spreadsheet.) Number of Annual Payments or Present Value Annuity Future Value Interest Rate Years 6 8% $325.83 ? 17 13% $1,312.26 $673.87 ? 26 2% 320 0.7% $425.77 %24

Essentials Of Investments
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
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Chapter 4, Question 2. Please see attached. The second image is a similar question with answers

**Future Value of an Ordinary Annuity** This table demonstrates how to calculate the future value for different scenarios of an ordinary annuity, where payments are made at the end of each period. The table consists of the following columns: 1. **Number of Payments or Years**: This column represents the total number of payments made. Examples include 5, 19, 27, and 360 years. 2. **Annual Interest Rate**: This column shows the interest rate applied annually to the annuity. Rates provided are 6%, 18%, 4.5%, and 1.2%. 3. **Present Value**: This column is set to 0 for all rows, indicating that the calculation focuses only on future values with no initial lump sum investment. 4. **Annuity**: The regular payment made each period. Given values are $344.05, $1,314.55, $799.31, and $551.55. 5. **Future Value**: This column contains the calculated future value of the annuities at the end of the payment period. The results, rounded to the nearest cent, are $1,939.44, $162,233.26, $40,534.07, and $3,322,162.06, respectively. In this context, the future value is the total amount accrued from making consistent payments (annuity) into the annuity account, factoring in the interest rate over the specified number of years. Calculations are rounded to the nearest cent to reflect precise financial figures.
Transcribed Image Text:**Future Value of an Ordinary Annuity** This table demonstrates how to calculate the future value for different scenarios of an ordinary annuity, where payments are made at the end of each period. The table consists of the following columns: 1. **Number of Payments or Years**: This column represents the total number of payments made. Examples include 5, 19, 27, and 360 years. 2. **Annual Interest Rate**: This column shows the interest rate applied annually to the annuity. Rates provided are 6%, 18%, 4.5%, and 1.2%. 3. **Present Value**: This column is set to 0 for all rows, indicating that the calculation focuses only on future values with no initial lump sum investment. 4. **Annuity**: The regular payment made each period. Given values are $344.05, $1,314.55, $799.31, and $551.55. 5. **Future Value**: This column contains the calculated future value of the annuities at the end of the payment period. The results, rounded to the nearest cent, are $1,939.44, $162,233.26, $40,534.07, and $3,322,162.06, respectively. In this context, the future value is the total amount accrued from making consistent payments (annuity) into the annuity account, factoring in the interest rate over the specified number of years. Calculations are rounded to the nearest cent to reflect precise financial figures.
**Future Value of an Ordinary Annuity:** In an ordinary annuity, payments are made at the end of each period. The table below is designed to help calculate the future value of such an annuity by filling in the missing future values. The values are rounded to the nearest cent. **Number of Payments or Years:** - 6 **Annual Interest Rate:** - 8% **Present Value:** - 0 **Annuity:** - $325.83 **Future Value:** - $___ (Round to the nearest cent.) --- **Data Table:** *(Click on the icon to copy the table contents into a spreadsheet.)* | Number of Payments or Years | Annual Interest Rate | Present Value | Annuity | Future Value | |-----------------------------|----------------------|---------------|---------|--------------| | 6 | 8% | 0 | $325.83 | ? | | 17 | 13% | 0 | $1,312.26 | ? | | 26 | 2% | 0 | $673.87 | ? | | 320 | 0.7% | 0 | $425.77 | ? | This table helps to determine how much the annuity will be worth at the end of the specified term, considering the annual interest rate and the annuity payments.
Transcribed Image Text:**Future Value of an Ordinary Annuity:** In an ordinary annuity, payments are made at the end of each period. The table below is designed to help calculate the future value of such an annuity by filling in the missing future values. The values are rounded to the nearest cent. **Number of Payments or Years:** - 6 **Annual Interest Rate:** - 8% **Present Value:** - 0 **Annuity:** - $325.83 **Future Value:** - $___ (Round to the nearest cent.) --- **Data Table:** *(Click on the icon to copy the table contents into a spreadsheet.)* | Number of Payments or Years | Annual Interest Rate | Present Value | Annuity | Future Value | |-----------------------------|----------------------|---------------|---------|--------------| | 6 | 8% | 0 | $325.83 | ? | | 17 | 13% | 0 | $1,312.26 | ? | | 26 | 2% | 0 | $673.87 | ? | | 320 | 0.7% | 0 | $425.77 | ? | This table helps to determine how much the annuity will be worth at the end of the specified term, considering the annual interest rate and the annuity payments.
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