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An annuity consists of quarterly payments of $200 for 10 years. (a) Calculate the annuitys future value at (i) 4% p.a. compounding quarterly and (ii)

An annuity consists of quarterly payments of $200 for 10 years.

(a) Calculate the annuitys future value at (i) 4% p.a. compounding quarterly and (ii) 8% p.a.

compounding quarterly. What relationship between FV and i do you observe?

(b) Calculate the annuitys present value at (i) 4% p.a. compounding quarterly and (ii) 8% p.a.

compounding quarterly. What relationship between PV and i do you observe?

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