6) 10,000 is paid to buy an annuity-immediate with 10 level annual payments at anannual effective rate of 10%. The payments are deposited right away into a fundearning an annual effective rate of 9%. What is the total accumulated value ofthe investment at the end of the 10th year?

Annuities are bought at present value and these pay annual payment for annuity period and the that…

Duy a ity-immediate with 10 level anni annual effective rate of 10%. The payments are deposited righ earning an annual effective rate of 9%. What is the total ac the investment at the end of the 10th year?

Duy a ity-immediate with 10 level anni annual effective rate of 10%. The payments are deposited righ earning an annual effective rate of 9%. What is the total ac the investment at the end of the 10th year?

EBK CFIN

6th Edition

ISBN:9781337671743

Author:BESLEY

Publisher:BESLEY

Chapter4: Time Value Of Money

Section: Chapter Questions

Problem 15PROB

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Question

6) 10,000 is paid to buy an annuity-immediate with 10 level annual payments at an
annual effective rate of 10%. The payments are deposited right away into a fund
earning an annual effective rate of 9%. What is the total accumulated value of
the investment at the end of the 10th year?

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