Question
An annual annuity-immediate pays $100 at the end of the first year. Each subsequent payment is 5% greater than the preceding payment. The last payment
An annual annuity-immediate pays $100 at the end of the first year. Each subsequent payment is 5% greater than the preceding payment. The last payment is at the end of the 20th year. Calculate the accumulated value at:
(a) an annual effective interest rate of 4%;
(b) an annual effective interest rate of 5%.
Answer: (a) $4,621.75 (b) $5,053.90
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Finance For Executives Managing For Value Creation
Authors: Gabriel Hawawini, Claude Viallet
2nd Edition
0324117752, 9780324117752
