1 COMPUTING THE VALUE OF A GROWING ANNUITY 3 Periodic Payment, P 4 Payment Growth, g 1000 6% 1296 5 Discount Rate, r 6 Number of Periods, n 8 Find the value of the annuity using: Hint: The formula for the present value of an annuity paying a constant periodic payment P at an interest rate of r for n periods is given by 9Annuity Formula 1 + g PVA(P, r, g, n) Cash flow 1 1,000.00 2 1,060.00 3 1,123.60 4 1,191.02 5 1.262.48 Year 12 8 Find the present value of the annuity using: 9 Using NPV function 0 Hint: Use the cash flows in the above table as inputs to the NPV function