Present Value of an Annuity Determine the present value of $230,000 to be received at the end of each of four years, using an interest rate of 6%, compounded annually, as follows: a. By successive computations, using the present value of $1 table in Exhibit 5. Round to the nearest whole dollar First year 216,982 Second Year 198,906 x Third Year 193,112 X 182,181 Fourth Year Total present value 796,975 b. By using the present value of an annuity of $1 table in Exhibit 7. Round to the nearest whole dollar, 796,975 c. Why is the present value of the four $230,000 cash receipts less than the $920,000 to be received in the future? The present value is less due to the compounding of interest over the years Exhibit7 Present Value of an Annuity of $1 at Compound interest Periods 549 0.00154 2.9389 095094 167267 10 0.00009 1.31554 0.000 2 SOVI 5 0.00 1632 2979 350515 WOCHE ESTICI CT 277500 36 LS12 RIO 7 0.98 1.000 2004 336720 10030 244171 2.100 3.56755 1. 2.36713 2.9746 BE ON 0.94340 183339 267301 346511 421216 391733 556258 2079 3016 76009 COLE 12 08 DOS YA 30375 2600 11141 4567 164 0.95230 15 272325 3.54595 4329 50750 5.763 461 7.12 7.72173 264540 142500 4.15566 4.54101 5.45453 06562 TEISE PICS 5.157 S270 49553 5.397 19929 7 3169 170079 435526 4.1652 5343 5750 614417 2014 421220 1.14612 racer SAS ZOVECO SMOS 6.00203 74 74353 11 1967 30929 592130 61533 7023 6 736879 791277 695220 753763 665610 21 sroers SOCESS COS 10 650