Copyright

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

Become a Study.com member to unlock this answer!

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...

See full answer below.


Learn more about this topic:

Loading...
What is Annuity? - Definition & Formula

from

Chapter 2 / Lesson 7
22K

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


Related to this Question

Explore our homework questions and answers library