Question
a. What is the present value of a 3-year annuity of $300 if the discount rate is 7%? (Do not round intermediate calculations. Round your
a. What is the present value of a 3-year annuity of $300 if the discount rate is 7%? (Do not round intermediate calculations. Round your answer to 2 decimal places.)
b. What is the present value of the annuity in (a) if you have to wait an additional year for the first payment? (Do not round intermediate calculations. Round your final answer to 2 decimal places.)
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c. I now have $15,000 in the bank earning interest of 0.50% per month. I need $25,000 to make a down payment on a house. I can save an additional $100 per month. How long will it take me to accumulate the $25,000? (Do not round intermediate calculations. Round your answer to 2 decimal places. Use a financial calculator or Excel.)
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