True or False: Given the amount needed at the beginning of the retirement period, the annual...
True or False: Given the amount needed at the beginning of the retirement period, the annual deposits needed during the working period can be found by solving for“PMT” in the FVA formula.
Homework Answers
Solution: The given statement is true.
since using excel, the PMT function in the FVA formula (i.e. future value of annuity) writes the amount of annual deposits needed during the working period to accumulate a desired sum at retirement.
Note: since, amount needed at the beginning of retirement period is a Future Sum thus, FVA is used instead of PVA.
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