E6-5 Answer - 249376.75 $249,376.75 Year 0 P=A(1/r(1(r(1...

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E6-5 (Computation of Present Value) Using the appropriate interest table, compute the present value of the following periodic amounts due at the end of the designated periods. (a) $30,000 receivable at the end of each period for 8 periods compounded at 12%. This is a case of annuity because the person is receiving the amount at the end of each period. By formulae By excel function To find present value of annuity 149029.19 $149,029.19 Year 0 P=A*((1/r)-((1/(r*((1+r)^n))) P=present value, A= Annuity r= rate of interest n=duration A= $30000, r= .12, n=8 Answer by table: See the Present value factor of Annuity table = Annuity * Present value factor of annuity table (12%,8 periods) 149040 (b) $30,000 payments to be made at the end of each period for 16 periods at 9%. This is a case of annuity because the person is receiving the amount at the end of each period. By formulae By excel function To find present value of annuity
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Unformatted text preview: 249376.75 $249,376.75 Year 0 P=A*((1/r)-((1/(r*((1+r)^n))) P=present value, A= Annuity r= rate of interest n=duration A= $30000, r= .09, n=16 Answer by table: See the Present value factor of Annuity table = Annuity * Present value factor of annuity table (9%,16 periods) 249390 (c) $30,000 payable at the end of the seventh, eighth, ninth, and tenth periods at 12%. Here we will use present value of amount formula PV=FV/(1+r)^n P=present value, A= Annuity r= rate of interest n=duration r= .12 By Formulae Year Amount Present value 7 30000 13570.48 8 30000 12116.50 9 30000 10818.30 10 30000 9659.20 46164.47 Here is my homework problem, I dont understand any of it and dont even know where to begin to tac By table PVF Present value 0.45 13560 0.4 12120 0.36 10830 0.32 9660 46170.00 The difference is due to approximations. es ckle it. Help please!...
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E6-5 Answer - 249376.75 $249,376.75 Year 0 P=A(1/r(1(r(1...

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