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An annuity pays ₱3,000 at the beginning of every year. What is the future value of this as of 18 years from now if the interest rate is 11% compounded annually?

 Jan 18, 2021
 #1
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Not positive, but I think

 

Ordinary annuity FV

FV = C ((1+i)n -1)/i       yields  $151187.81

 Jan 18, 2021
 #2
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Because annuity payments are made at the BEGINNING of the year, it is called "Annuity Due". So, to get the correct FV, you would simply multiply it by one extra period, or by: (1 + 0.11) =1.11. So, the FV =$151,187.81 * 1.11 = $167,818.47, which is the FV of this annuity due.

 Jan 18, 2021
edited by Guest  Jan 18, 2021
 #3
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Second guest is correct....I calculated payments at end of year....missed that part in the Q when I read it !   cheeky

Guest Jan 18, 2021

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