# Your parents promise to give you $94 a month for 3 years, starting at the end of this month, to...

## Question:

Your parents promise to give you $94 a month for 3 years, starting at the end of this month, to help you out. At a 6.02 percent APR discount rate, what are these payments worth to you right now?

## Annuity:

In finance sector, the concept of an annuity implemented widely in practical cases. This concept could help investors in creating a savings plan with equal annual deposit. Or, the concept could determine periodic payments on a term loan.

## Answer and Explanation: 1

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View this answer**Given information:**

- Monthly deposit = $94
- N = 3 x 12 = 36
- APR = 6.02%

**Estimate the present value of payments: **

{eq}PV = \displaystyle...

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Chapter 2 / Lesson 7Learn about annuities. Understand what an annuity is, examine the annuity formula and learn how to calculate its future value, and see examples of annuities.

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