You may purchase an annuity that will pay you ¥300,000 in income per year starting one year from now and continuing for a total of 22 years, or 22 payments. Assuming an annual risk-free interest rate of 4%. What is a fair price for this annuity? Round your answer to the nearest yen

You may purchase an annuity that will pay you ¥300,000 in income per year starting one year from now and continuing for a total of 22 years, or 22 payments. Assuming an annual risk-free interest rate of 4%. What is a fair price for this annuity? Round your answer to the nearest yen

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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Similar questions

Find the future value of the following ordinary annuity. Payments are made and interest is compounded as given. R = $1,000, 5% interest compounded monthly for 6 years What is the future value of the ordinary annuity? (Round to the nearest dollar as needed.)
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