Question
A) Find the PV of an ordinary annuity that pays $1,000 each of the next 5 years if the interest rate is 16%. Then find
A) Find the PV of an ordinary annuity that pays $1,000 each of the next 5 years if the interest rate is 16%. Then find the FV of that same annuity. Round your answers to the nearest cent.
PV of ordinary annuity: $
FV of ordinary annuity: $
B) How will the PV and FV of the annuity in part A change if it is an annuity due rather than an ordinary annuity? Round your answers to the nearest cent.
PV of annuity due: $
FV of annuity due: $
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Corporate Finance A Focused Approach
Authors: Michael C. Ehrhardt, Eugene F. Brigham
6th edition
1305637100, 978-1305637108
