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2. What is the present value of a 9-year $400 annuity with the first of the 9 payments today? The discount rate is 4%. a.

2. What is the present value of a 9-year $400 annuity with the first of the 9 payments today? The discount rate is 4%.

a. 3,290 b. 2,980 c. 3,160 d. None of the above

Recompute your answer assuming that the first $400 payment grows at 2% per year for the life of the annuity.

a. 3,400 b. 2,760 c. 3,090 d. None of the above

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