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Anon25
2 months ago
11

You will receive 27 annual payments of $22,500. The first payment will be received 7 years from today and the interest rate is 5

.1 percent. What is the value of the payments today?
Business
1 answer:
arsen [3.4K]2 months ago
6 0

Answer:

PV= $230,148.09

Explanation:

Considering the following details:

You will get 27 yearly payments of $22,500. The initial payment is set to begin 7 years from now with an interest rate of 5.1 percent.

First, we will determine the future value of these payments using this formula:

FV= {A*[(1+i)^n-1]}/i

A= annual payment= 22,500

n= 27

i= 0.051

FV= {22,500*[(1.051^27)-1]}/ 0.051

FV= $1,248,819.52

Next, we will find the present value:

PV= FV/(1+i)^n

PV= 1,248,819.52/ (1.051^34)

PV= $230,148.09

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Lana owns a house worth $325,000 and has a mortgage of $245,000. She owns a guitar worth $750. She also owns a car worth $15,000
Scilla [3833]
Net worth is calculated as total assets minus total liabilities.

The total assets are
325,000 + 750 + 15,000 + 8,000 + 2,100
which equals 350,850.

Concerning total liabilities, we calculate
245,000 + 9,000
for 254,000.

Thus, net worth is evaluated as
350,850 - 254,000
resulting in 96,850.

I hope this helps!
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