Question

1. Compute: (show your work)

a. Compute the present values of the following ordinary annuities.

Payment	Years	Interest Rate	Present Value
$678.09	7	13%
$7,968.26	13	6%
$20,322.93	23	4%

b. Compute the future values of the following ordinary annuities.

Payment	Years	Interest Rate	Future Value
$123	13	13%
$4,555	8	8%
$74,484	5	10%

Answer 1

a)	Present value
	$       2,998.93	=678.09*(1-(1/(1+13%)^7))/13%
	$     70,540.48	=7968.26*(1-(1/(1+6%)^13))/6%
	$   301,934.55	=20322.93*(1-(1/(1+4%)^23))/4%
b)	Future value
	$       3,688.12	=123*((1+13%)^13-1)/13%
	$     48,449.84	=4555*((1+8%)^8-1)/8%
	$   454,732.27	=74484*((1+10%)^5-1)/10%