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
Problem 1PS
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Future Value of Annuity:
It refers to the future worth of the periodic payments made at the end of each period.
Future value is calculated by compounding these periodic payments with an interest rate. The higher the rate of interest, the higher the future value of the annuity will be.
The concept of future value is used by many investors to know their portfolio worth.
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