E-6

What is the present value of a 7-year annuity of $1,000 per period in which payments come at the beginning of each period? The interest rate is 13 percent. UseAppendix Dfor an approximate answer, but calculate your final answer using the formula and financial calculator methods. When using Appendix D to find the present value of this annuity due, subtract 1 from n and add 1 to the table value.(Do not round intermediate calculations. Round your final answer to 2 decimal places. )

Present Value=

E-7

Betty Bronson has just retired after 25 years with the electric company. Her total pension funds have an accumulated value of $330,000, and her life expectancy is 15 more years. Her pension fund manager assumes he can earn a 10 percent return on her assets.

What will be her yearly annuity for the next 15 years? UseAppendix Dfor an approximate answer, but calculate your final answer using the formula and financial calculator methods.(Do not round intermediate calculations. Round your final answer to 2 decimal places.)

Annuity=

E-8

Morgan Jennings, a geography professor, invests $81,000 in a parcel of land that is expected to increase in value by 14 percent per year for the next six years. He will take the proceeds and provide himself with a 12-year annuity.

Assuming a 14 percent interest rate, how much will this annuity be? UseAppendix AandAppendix Dfor an approximate answer, but calculate your final answer using the formula andfinancial calculator methods.(Do not round intermediate calculations. Round your final answer to 2 decimal places.)

Annuity Value=