## Future Value of annuity:

Future value of annuity is the future value of an equal annual or periodic payments to be received at some point in future. It depends on the amount of payment, the prevailing interest rate and the time period.

## Answer and Explanation: 1

Future value of annuity can be calculated by the given formula:

{eq}FV= Payment(\frac{(1+r)^n-1}{r}) {/eq}

Here:

Payment has to be calculated.

FV=$90,000 r (rate)=6.80% or 0.068 n=10 Substituting the values we have: 90000=Payment((1+0.068)^10)-1)/0.068 90000=Payment *13.68622 Payment=90000/13.68622 =$6,575.77