What is the future value of a 5-year ordinary annuity with annual payments of $200, evaluated at a 15 percent interest rate? Select one: a

Finance Aug 13, 2020

What is the future value of a 5-year ordinary annuity with annual payments of $200, evaluated at a 15 percent interest rate? Select one: a. $1,348.48 O b. $1.522.64 O c. 670.44 d. $1,169.56

Expert Solution

here annual payment C = $200

rate r = 15%

time t =5 years

Future Value of annuity F = (C/r)*((1+r)^t-1)

=(200/0.15)*(1.15^5-1)

=1333.33*1.01

=$1348.48

Hence option a is correct here.

Archived Solution

Unlocked Solution

You have full access to this solution. To save a copy with all formatting and attachments, use the button below.

Already a member? Sign In

Important Note: This solution is from our archive and has been purchased by others. Submitting it as-is may trigger plagiarism detection. Use it for reference only.

For ready-to-submit work, please order a fresh solution below.

Or get 100% fresh solution

Get Custom Quote