You want to buy an ordinary annuity that will pay you $4,000 a year for the next 20 years. You expect annual interest rates will be 8 percent over that time period. The maximum price you would be willing to pay for the annuity is closest to ANS: 39,272
You want to buy an ordinary annuity that will pay you $4,000 a year for the next 20 years. You expect annual interest rates will be 8 percent over that time period. The maximum price you would be willing to pay for the annuity is closest to ANS: 39,272
Chapter5: The Time Value Of Money
Section: Chapter Questions
Problem 16P
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You want to buy an ordinary
ANS: 39,272
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