The present value of an annuity is the sum of the discounted value of all future cash flows. You have the opportunity to invest in several annuities. Which of the following 10-year annuities has the greatest present value (PV)? Assume that all annuities earn the same positive interest rate. bevinning of each year An annuity that pays $500 at the end of every six months An annuity that pays $1,000 at the beginning of each year An annuity that pays $500 at the beginning of every six months An annuity that pays $1,000 at the end of each year You bought an annuity selling at $12,719.28 today that promises to make equal payments at the beginning of each year for the next 10 years (N). If the annuity's appropriate interest rate (1) remains at 9.50% during this time, then the value of the annual annuity payment (PMT) is You just won the lottery. Congratulations! The jackpot is $35,000,000, paid in 10 equal annaal payments. The first payment on the lottery jackpot will be made today. In present value terms, you really won assuming annual interest rate of 9.50%. 02 -2016 Oracle NE Save & Continue 8. Implied interest rate and period Consider the case of the following annuities, and the need to compute either their expected rate of return or duration Anthony needed money for some unexpected expenses, so he borrowed $4,278.62 from a friend and agreed to repay the loan in five equal installments of $1,100 at the end of each year. The agreement is offering an implied interest rate of 7.83% 9.00% 12.15% Anthon 10.62 ck, wants to go to business school. While his father will share some of the expenses, Jack stil needs to put in the rest on his own. But Jack has no money saved for it yet. According to his calculations, it will cost him $37,610 to complete the business program, including tuition, cost of living, and other expenses. He has decided to deposit $3,800 at the end of every year in a mutual fund, from which he expects to earn a fixed 6% rate of return. It will take approximately years for Jack to save enough money to go to business school