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Suppose you just bought an annuity with 25 annual payments of $8,500 per year at the current interest rate of 9 percent per year.
Suppose you just bought an annuity with 25 annual payments of $8,500 per year at the current interest rate of 9 percent per year. a. What is the value of your annuity today? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) b. What happens to the value of your investment if interest rates suddenly drop to 4 percent? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) c. What if interest rates suddenly rise to 14 percent? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) a. Present value at 9 percent b. Present value at 4 percent c. Present value at 14 percent
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