Question
43) A) compute the present value of a finite annuity stream. The first payment occurs in 9 years, and the last payment occurs 18 years
43) A) compute the present value of a finite annuity stream. The first payment occurs in 9 years, and the last payment occurs 18 years from today. The first payment will be $111. Subsequent payments will SHRINK at an annual rate of -3.2%. Use an effective annual rate (EAR) of 8.6%.
B) Compute the present value of a finite annuity stream. The first payment occurs in one year, and the last payment occurs 12 years from today. The first payment will be $251. Subsequent payments will grow at an annual rate of 4.1%. Use an effective annual discount rate (EAR) of 11.9%.
C) Compute the present value of a finite annuity stream. The first payment occurs in one year, and the last payment occurs 8 years from today. The first payment will be $150. Subsequent payments will grow at an annual rate of 4%. Use an effective annual discount rate (EAR) of 6%.
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