Processing math: 25%
Creative Commons License
This work is licensed under a Creative Commons Attribution-NonCommercial-NoDerivs 3.0 Unported License. math exams: Question FM 11/19/2011 08:21

Saturday, November 19, 2011

Question FM 11/19/2011 08:21

Amelie receives a payments at the end of each yera for 20 years. The first payment is \$2000. The remaining payments increase by 5\%, compounded each time.
Calculate the prsent value of the payments at time 0, using an annual effective rate of interest of 10\%.

Ans: \frac{2000}{1.05}[\frac{1-(1.047619)^{-20}}{0.047619}]

No comments:

Post a Comment