Question

- An annuity immediate pays 200 every month for 10 years.
Calculate the present value at the following rates of interest:
- Annual effective interest rate of 6%
- Nominal interest rate convertible monthly of 8%
- Nominal rate of discount convertible once every two years of 4%

Answer #1

Write the symbol for the present value of an annuity immediate
that pays $2 monthly at an annual effective rate of 8% for 10 years
then calculate its value.

An annuity-immediate has 20 annual payments starting at 5 and
increasing by 10 every year. The annual effective rate of interest
is 7%. Calculate the present value of this annuity.
not a excel solution

A 10-year annuity pays $2,100 per month at the end of each
month. If the discount rate is 8 percent compounded monthly for the
first seven years and 8 percent compounded monthly thereafter, what
is the present value of the annuity?

1. Calculate the present value of an annuity stream that pays
$20,000 every year for 5 years on the last day of each year if your
investment pays 20% compounded quarterly?
2. Calculate the future value of $20,000 invested today for 6 years
if your investment pays 4% compounded annually
3. Calculate the future value of an annuity stream that pays $6,000
every year for 5 years on the last day of each year if your
investment pays 10% compounded...

Calculate the accumulated value of an annuity immediate that
pays 1000 at the end of each quarter for 20 years. The interest
rate is 7% compounded quarterly.

Sigmund deposits K at time t = 0. His balance (assuming no
deposits or withdrawals) doubles in six years.
(a) What is the annual effective discount rate?
(b) What is the nominal discount rate convertible bi-monthly
(once every two months)?
(c) What is the nominal interest rate convertible semi-monthly
(twice per month)?
(d) What is the nominal interest rate convertible once every two
years?
(e) What is the force of interest?

A.Calculate the present value of an annuity of $5,000 received
annually that begins today and continues for 10 years, assuming a
discount rate of 9%.
B. Joan invested $5,000 in an interest-bearing account earning
an 8% annual rate of interest compounded monthly. How much will the
account be worth at the end of 5 years, assuming all interest is
reinvested at the 8% rate?
C. Calculate the present value of an ordinary annuity of $5,000
received annually for 10 years,...

Use Table 12-1 to calculate the future value (in $) of the
annuity due. (Round your answer to the nearest cent.) Annuity
Payment Payment Frequency Time Period (years) Nominal Rate (%)
Interest Compounded Future Value of the Annuity $90 every month
Annuity
PaymentPayment
FrequencyTime
Period (years)Nominal
Rate (%)Interest
CompoundedFuture Value
of the Annuity$90 every month for payment every month for 1.5 years
at 6% interest compounded monthly = future value of the annuity

Calculate the present value of annuity with payment of $1 at the
end of the first year and every two years thereafter. There are
total 5 payments. The last payment of $1 is at the end of 9th year.
The interest rate is 6% convertible semi-annually.(Write the
solution with formulas)

Which of the following statements is CORRECT?
a. The present value of a 3-year,
$150 annuity due will exceed the present value of a 3-year, $150
ordinary annuity.
b. An investment that has a nominal
rate of 6% with semiannual payments will have an effective rate
that is smaller than 6%.
c. If a loan has a nominal annual
rate of 8%, then the effective rate can never be greater than
8%.
d. The proportion of the payment
that goes...

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