Question
You are offered an annuity that will pay $20,000 per year for 10 years. The appropriate discount rate is 8%. What is the annuity worth
You are offered an annuity that will pay $20,000 per year for 10 years. The appropriate discount rate is 8%.
What is the annuity worth to you today if the first payment will be made one year from now? (Do not round intermediate calculations. Enter the answer in dollars. Round the final answer to 2 decimal places. Omit $ sign in your response.)
Present value of annuity $
What is the annuity worth to you today if the first payment is made today? (Do not round intermediate calculations. Enter the answer in dollars. Round the final answer to 2 decimal places. Omit $ sign in your response.)
Present value of annuity due
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Investment Science
Authors: David G. Luenberger
1st International Edition
0195391063, 9780195391060
