Suppose you are going to receive $13,500 per year for five years. The interest rate is 8.4% a. What is the present value of the payments if they are in the form of an ordinary annuity? What is the present value if the payments are an annuity due? b. Suppose you plan to invest the payments for five years. What is the future value if the payments are an ordinary annuity? What if the payments are annuity due? c. Which has the highest present value (future value), the ordinary annuity or annuity due?

Q: What is the present value of an ordinary annuity of $1,000 per year for 9 years discounted back to…

A: Present value of annuity payment - it means present value of future annual equal payment made to a…

Q: Help

A: Perpetuity in the monetary framework is a circumstance where a cash of income installments proceeds…

Q: Suppose you bought a 25-year annuity of $7,900 per year at the current discount rate of 12 percent…

A: The objective of this question is to calculate the present value of an annuity under different…

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A: Given, Payment amount (PMT) = 300,000 Number of payments (n) = 22 Interest rate (i) = 4%

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A: Formula for finding PV  PV=Payment per month*[{1-{1+interest rate)^(-Time period)}}/interest rate]…

Q: Use graphical approximation techniques or an equation solver to approximate the desired interest…

A: Nominal rate:The nominal rate, in the realm of finance, refers to the stated or advertised interest…

Q: Use the formula for the value of an annuity to solve:To save for retirement, you decide to deposit…

A: The future value of the annuity is the total value of all the payments which occurred regularly at a…

Q: Your insurance company offered you an annuity that pays you $100 at the end of each year. The life…

A: GIVEN, A= $100 N=10  R=8%

Q: What is the present value of an annuity that pays $58 per year for 13 years and an additional $1,000…

A: We can make use of the financial calculator to obtain the present value, PV. Inputs: I/Y = rate =…

Q: What's the present value of a 4-year ordinary annuity of $2,250 per year plus an additional $3,000…

A: Data given: Annuity=$2250 Additional at the end of Year 4=$3000 n=4 Interest rate=5%   Required:…

Q: 1- If you invested $10,000 in an investment account and you expect it to double in 4 years, what…

A: 1. Investment= $10000 time= 4 years

Q: Your investment advisor wants you to purchase an annuity that will pay you $81,491 after 10 years.…

A: The present value of an annuity refers to the value of the future payments on the current date…

Q: Find the present value of an annuity of $ 365.00 per month for 26 years at a rate of 3 1/4% interest…

A: Monthly payment (P) = $ 365 Period = 26 Years Number of monthly payments (n) = 26*12 = 312 Annual…

Q: 2. You buy a perpetuity that starts its annual payment $100 in 5 years from now. The EAR is 5%. a.…

A: A perpetuity is a series of equal cash flows which are never-ending ie: they go on forever. The…

Q: Suppose that you want to avoid paying interest and decide you'll only buy the furniture when you…

A: Annuity refers to the contract that is made between the insurer and the insurance company for making…

Q: a. What is the amount of the annuity purchase required if you wish to receive a fixed payment of…

A: Present value is an estimate of the present value of future cash values ​​that may be received at a…

Q: A new investment opportunity for you is an annuity that pays $800 at the beginning of each year for…

A: Beginning of period Annuity Annuity Amount = 800 Time Period (N) = 3 years Rate = 5.5%

Q: you just won the state lottery, and you have a choice between receiving $2,625,000 today or a…

A: Rate of return inbuilt in annuity is rate at which present value of annuity is equals to amount of…

Q: What is the future value of an ordinary annuity of $1,000 per year for 9 years compounded at 10…

A: Given: Annual cash flow (A)=$1000 Number of years (n) =9 years Interest rate(r) = 10% = 0.10

Q: An annuity pays out $20000 per year. Because of inflation, each year one dollar is worth what 0.95…

A: Annuity per year = $20,000Because of inflation, each year 1 dollar is worth what $0.95 was worth of…

Q: How much would you be willing to pay today for an ordinary annuity that makes equal annual payments…

A: An ordinary annuity is the series of an equal payment that is paid or received at each week, month,…

Q: Suppose you will receive a payment of $80000 in 5 years at a rate of 3% lasting 10 years. Find the…

A: The solution requires the use of formulae applicable in time value of money. They are shown in steps…

Q: Suppose you are going to receive $13,500 per year for five years. The appropriate interest rate is…

A: In an ordinary annuity, the cash flow occurs at the end of each period.Present value of ordinary…

Q: You invest in an ordinary annuity $3,000 annually at 7% annual interest. What is the future value of…

A: Given:  Amount = 3000 r = 7% n = 5 years

Q: Suppose you begin saving for your retirement by depositing $2,000 per year in an IRA. If the…

A: The future value is the amount that will be received at the end of a certain period. In simple…

Q: What would be the maximum price you should pay for a 10 year annuity that will provide payments of…

A: Present value of annuity formula-PV = A × WherePV = Present value of annuity A = periodic payments r…

Q: If the present value of an ordinary, 6- year annuity is $7,200 and inter present value of the same…

A: In ordinary annuity there are payments at the end of period only and in annuity due payments are at…

Q: What's the future value of a 3%, 5-year ordinary annuity that pays $300 each year? If this was an…

A: Interest Rate = r = 3%Time = t = 5 YearsAnnuity = a = $300

Q: Suppose you are going to receive $12,700 per year for six years. The appropriate interest rate is…

A: Using excel PV and FV for calculating present value of annuity and future value of annuity

Q: What is the future value of a 6%, 10-year ordinary annuity that pays $200 each year?  If this were…

A: The future value of annuity is calculated using the formula below:

Q: A perpetuity will make its first payment in 20 years. The first payment will be $5,000, and future…

A: Perpetuity means a series of infinite numbers of payments of the same size occurs in an equal…

Q: What is the present value of a ten year annuity whose payment will be $20,000 next year and then…

A: Time = t = 10 YearsPayment = p = $20,000Growth Rate = g = 3%Discount Rate = r = 6.4%

Q: Would you prefer the following:   a. An ordinary annuity where you receive $500 each year for 7…

A: An ordinary annuity is one in which the cash flows occur at the end of each year or each period.…

Q: If the present value of an ordinary, six-year annuity is $8,500 and the interest rates are 9.5…

A: Given: Resent value of Ordinary Annuity = $8500 Interest Rate = 9.5% Time =6 years So, the value of…

Q: Suppose an annuity will pay $14,000 at the beginning of each year for the next 5 years. How much…

A: Annual payment (P) = $14,000 Interest rate (r) = 6.5% Period (n) = 5 Years

Q: a. Calculate the annual cash flows ( annuity payments) from a fixed - payment annuity if the present…

A: Annual cash flows refer to the amount that defines the inflow and outflow of the cash during the…

Q: Calculate the present value of this infinite future payment of $100

A: Time value of money (TVM) refers to the method used to measure the amount of money at different…

Q: Suppose you are going to receive $17,500 per year for five years. The appropriate interest rate is…

A:

Q: present value of an ordinary back to the present at 10 percen as

A: The present value of the annuity can be computed as follows : Calculations for above :

Q: A one-year annuity that pays $100 semi-annually will starts its payment in 6 months from now. APR is…

A: Present Value of  Ordinary Annuity refers to the concept which dictates the discounted value of a…

Q: What amount will be paid at the beginning of every month for 10 years if the present value is 20O,…

A: The payment flow which continues for a definite time period and terminates after lapse of time…

Types of Insurance Contract

Insurance is a contract wherein an individual or entity gets financial protection from the insurance company for any damages or losses incurred. The individual or entity is called the insured, whereas the insurance company is called the insurer. The insured and the insurer enter a legal contract for a fixed term called the insurance term, and the contract is called an insurance policy.