Homework Answers
Information provided:
Annuity= $5,000
Time= 15 years
Interest rate= 4.5%
The present value of the annuity is calculated by entering the below in a financial calculator:
PMT= 5,000
N= 15
I/Y= 4.5
Press the CPT key and PV to compute the present value of the annuity.
The value obtained is 53,697.7286.
Therefore, the present value of the annuity is
$53,697.7286
$53,298.
Hence, the answer is option c.
In case of any query, kindly comment on the solution.
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