As part of your employee benefits package, you are offered an annuity that will pay $14,000...
As part of your employee benefits package, you are offered an annuity that will pay $14,000 per year for 9 years (the first payment will occur two years from today). If the appropriate interest rate is 11%,
a) What is the annuity worth to you today?
b) What is the annuity worth at the end of the 9 years
Homework Answers
We will use the present value of the annuity formula for calculating the annuity worth today and at the end of 9th year.
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