Your answer is incorrect. Paul is planning for his retirement this year. One option that has been presented to him is the purchase of an annuity that would provide a $40,000 payment each year for the next 10 years. Click here to view the factor table. Calculate how much Paul should be willing to pay for the annuity if he can invest his funds at 7%. (For calculation purposes, use 4 decimal places as displayed in the factor table provided and round final answer to O decimal place, eg. 58,971) Payment 20332 APPENDIX 9.1 Present value of $1 received in n periods. Periods 4% 5% 6% 7% 10% 11% 1 0.9615 0.9524 0.9434 2 0.9246 0.9070 0.8900 3 0.8890 0.8638 0.8396 4 0.8548 0.8227 0.7921 5 0.8219 0.7835 0.7473 0.7629 0.7130 8% 9% 0.9346 0.9259 0.9174 0.9091 0.9009 0.8929 0.8850 0.8734 0.8573 0.8417 0.8264 0.8116 0.7972 0.7831 0.8163 0.7938 0.7722 0.7513 0.7312 0.7118 0.6931 0.6750 0.6407 0.7350 0.7084 0.6830 0.6587 0.6355 0.6133 0.5921 0.5523 0.5158 0.6806 0.6499 0.6209 0.5935 0.5674 0.5428 0.5194 0.4761 0.4371 0.4019 12% 13% 14% 16% 18% 20% 0.8772 0.8621 0.8475 0.8333 0.7695 0.7432 0.7182 0.6944 0.6086 0.5787 0.4823 6 0.7903 889 7 0.7599 10 0.7462 0.7050 0.6663 0.6302 0.5963 0.5645 0.5346 0.5066 0.4803 0.4556 0.4104 0.3704 0.3349 0.7107 0.6651 0.6227 0.5835 0.5470 0.5132 0.4817 0.4523 0.4251 0.3996 0.3538 0.3139 0.2791 0.7307 0.6768 0.6274 0.5820 0.5403 0.5019 0.4665 0.4339 0.4039 0.3762 0.3506 0.3050 0.2660 0.2326 0.7026 0.6446 0.5919 0.5439 0.5002 0.4604 0.4241 0.3909 0.3606 0.3329 0.3075 0.2630 0.2255 0.1938 0.6756 0.6139 0.5584 0.5083 0.4632 0.4224 0.3855 0.3522 0.3220 0.2946 0.2697 0.2267 0.1911 0.1615 12312 0.6496 0.5847 0.5268 0.4751 0.6246 0.5568 0.4970 0.6006 0.5303 0.4688 0.4440 0.4150 14. 0.5775 0.5051 0.4423 15 0.5553 0.4810 0.4173 0.3878 0.3624 0.4289 0.3875 0.3505 0.3971 0.3555 0.3186 0.2858 0.3677 0.3262 0.2897 0.2575 0.2292 0.3405 0.2992 0.2633 0.2320 0.2046 0.3152 0.2745 0.2394 0.2090 0.1827 0.3173 0.2875 0.2607 0.2567 0.2366 0.2307 0.2076 0.1685 0.1372 0.1122 0.2042 0.1821 0.1452 0.1163 0.0935 0.1807 0.1597 0.1252 0.0985 0.0779 0.1599 0.1401 0.1079 0.0835 0.0649 0.1954 0.1619 0.1346 67228 17 18 19 20 0.3118 16 0.5339 0.4581 0.3936 0.3387 0.2919 0.2519 0.2176 0.1883 0.1631 0.5134 0.4363 0.3714 0.3166 0.2703 0.2311 0.1978 0.1696 0.1456 0.4936 0.4155 0.3503 0.2959 0.2502 0.2120 0.1799 0.1528 0.1300 0.4746 0.3957 0.3305 0.2765 0.2317 0.1945 0.1635 0.1377 0.1161 0.4564 0.3769 0.2584 0.2145 0.1784 0.1486) 0.1240 0.1037 0.0868 0.0728 0.1415 0.1229 0.0930 0.0708 0.0541 0.1252 0.1078 0.0802 0.0600 0.1108 0.0946 0.0691 0.0508 0.0376 0.0981 0.0829 0.0451 0.0596 0.0431 0.0313 0.0514 0.0365 0.0261 $1 PV= (1+1) APPENDIX 9.2 Present value of an annuity of $1 per period. Periods 4% 5% 6% 1 2 3 4 5 3.6299 4.4518 0.9615 0.9524 0.9434 1.8861 1.8594 1.8334 2.7751 2.7232 2.6730 3.5460 3.4651 4.3295 4.2124 7% 8% 9% 11% 0.9346 0.9259 0.9174 0.9091 0.9009 1.8080 1.7833 1.7591 1.7355 1.7125 2.6243 2.5771 2.5313 2.4868 2.4437) 2.4018 3.3872 3.3121 3.2397 3.1698 3.1024 3.0373 4.1002 3.9927 3.8897 3.7907 3.6959 3.6048 10% 12% 0.8929 13% 14% 0.8850 0.8772 20% 0.8621 0.8475 0.8333 1.6901 1.6681 1.6467 1.6052 1.5656 1.5278 2.1065 16% 18% 3.2743 2.3612 2.3216 2.2459 2.1743 2.9745 2.9137 2.7982 2.6901 2.5887 3.5172 3.4331 3.1272 2.9906 6 5.2421 889 7 10 5.0757 4.9173 6.0021 5.7864 5.5824 6.7327 6.4632 6.2098 7.4353 7.1078 6.8017 81109 77217 7:3601 4.7665 4.6229 4.4859 4,3553 5.3893 5.2064 5.0330 4.8684 5.9713 5.7466 5.5348 5.3349 6.5152 6.2469 5.9952 5.7590 7.0236 67101 64177 61446 4.2305 4.1114 3.9975 3.8887 3.6847 4.7122 4.5638 4.4226 4.2883 4.0386 3.8115 3.60461 5.1461 4.9676 4.7988 4.6389 4,3436 4.0776 3.8372 5.5370 5.3282 5.1317 4.9464 4.6065 4.3030 4.0310 58892 56502 54262 52161 48332 3.4976 3.3255 44911 41925 APPENDIX 9.2 Present value of an annuity of $1 per period. Periods 4% 5% 6% 7% 1 0.9615 2 1.8861 3 2.7751 4 3.6299 5 4.4518 0.9524 0.9434 1.8594 1.8334 2.7232 2.6730 3.5460 3.4651 4.3295 4.2124 8% 9% 0.9346 0.9259 0.9174 0.9091 1.8080 1.7833 1.7591 1.7355 2.6243 2.5771 2.5313 24868 3.3872 3.3121 3.2397 3.1698 4.1002 3.9927 3.8897 3.7907 10% 11% 12% 13% 14% 16% 18% 20% 0.9009 0.8929 0.8850 0.8772 0.8621 0.8475 0.8333 1.7125 1.6901 1.6681 1.6467 1.6052 1.5656 1.5278 2.4437 2.4018 2.3612 2.3216 2.2459 2.1743 21065 3.1024 3.0373 2.9745 2.9137 2.7982 2.6901 2.5887 3.6959 3.6048 3.5172 3.4331 3.2743 3.1272 2.9906 6 5.2421 7 6.0021 8 6.7327 9 7.4353 10 8.1109 5.0757 4.9173 4.7665 4.6229 4.4859 4.3553 5.7864 5.5824 5.3893 5.2064 5.0330 4.8684 6.4632 6.2098 5.9713 5.7466 5.5348 5.3349) 7.1078 6.8017 6.5152 6.2469 5.9952 5.7590 7.7217 7.3601 7.0236 6.7101 6.4177 6.1446 4.2305 4.1114 3.9975 3.8887 3.6847 3.4976 3.3255 4.7122 4.5638 4.4226 4.2883 4.0386 3.8115 3.6046 5.1461 4.9676) 4.7988 4.6389 4,3436 4.0776 3.8372 5.5370 5.3282 5.1317 4.9464 4.6065 4.3030 4.0310 5.8892 5.6502 5.4262 5.2161 4.8332) 4.4941 4.1925 11 8.7605 12 9.3851 13 14 15 10.5631 9.8986 11.1184 10.3797 8.3064 7.8869 8.8633 8.3838 9.9856 9.3936 8.8527 9.2950 9.7122 7.4987 7.1390 6.8052 6.4951 7.9427 7.5361 7.1607 6.8137 8.3577 7.9038 74869 7.1034 8.7455 8.2442 7.7862 8.5595 8.0607 9.1079 7.3667 7.6061 6.0021 6.1422 6.2065 5.9377 5.6869 54527 5.02861 4.6560 4.3271 4.7932 6.4924 6.1944 5.9176 5.6603 4.4392 5.1971 6.7499 6.4235 6.1218 5.8424 5.3423 4.9095 4.5327 5.0081 4.6106 54675 6.9819 6.6282 6.3025 4.6755 5.5755 5.0916) 7.1909 6.8109 6.4624 16 17 12.1657 18 12.6593 19 13.1339 11.6523 10.8378 10.1059 9.4466 8.8514 8.3126 7.8237 11.2741 10.4773 9.7632 9.1216 8.5436 8.0216 11.6896 10.8276 10.0591 9.3719 8.7556 8.2014 8.3649 12.0853 11.1581 10.3356 9.6036 8.9501 7.3792 7.5488 7.7016 7.8393 7.3658 20 13.5903 12.4622 11.4699 10.5940 9.8181 9.1285 8.5136 7.9633 7.4694 6.9740 6.6039 6.2651 7.1196 6.7291 6.3729 5.7487 5.8178 7.2497 6.8399 6.4674 6.9380 6.5504 5.8775 5.3162 7.0248 5.6685 5.1624 4.7296 5.2223 4.77461 5.2732 4.8122 4.8435 6.6231 5.9288 5.3527 4.8696 1 $1- (1+1)" PVA