A 6-year annuity of twelve $10,200 semiannual payments will begin 9 years from n
ID: 2384336 • Letter: A
Question
A 6-year annuity of twelve $10,200 semiannual payments will begin 9 years from now, with the first payment coming 9.5 years from now.
If the discount rate is 8 percent compounded monthly, what is the value of this annuity five years from now?(Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)
If the discount rate is 8 percent compounded monthly, what is the value three years from now? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)
If the discount rate is 8 percent compounded monthly, what is the current value of the annuity? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)
A 6-year annuity of twelve $10,200 semiannual payments will begin 9 years from now, with the first payment coming 9.5 years from now.
Explanation / Answer
A 6-year annuity of twelve $10,200 semiannual payments will begin 9 years from now, with the first payment coming 9.5 years from now.
Half Yearly Interest rate = (1+8%/12)^6 - 1 = 4.067262%
Value of annuity 9 year from now = pv(rate,nper,pmt,fv)
Value of annuity 9 year from now = pv(4.067262%,12,10200,0)
Value of annuity 9 year from now = $ 95,355.24
If the discount rate is 8 percent compounded monthly, what is the value of this annuity five years from now?(Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)
Value of annuity 5 year from now = Value of annuity 9 year from now/(1+ halfyearly rate)^(4*2)
Value of annuity 5 year from now = 95355.24/1.04067262^8
Value of annuity 5 year from now = $ 69,315.69
Answer
Value of the annuity $ 69,315.69
If the discount rate is 8 percent compounded monthly, what is the value three years from now? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)
Value of annuity 3 year from now = Value of annuity 9 year from now/(1+ halfyearly rate)^(6*2)
Value of annuity 3 year from now = 95355.24/1.04067262^12
Value of annuity 3 year from now = $ 59098.30
Answer
Value of the annuity $ 59,098.30
If the discount rate is 8 percent compounded monthly, what is the current value of the annuity? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)
Current value of the annuity = Value of annuity 9 year from now/(1+ halfyearly rate)^(9*2)
Current value of the annuity = 95355.24/1.04067262^18
Current value of the annuity = $ 46,525.41
Answer
Value of the annuity $ 46,525.41
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