What is the present value of an annuity due of $1000 per month for 20 years discounted at 9% per annum (assuming monthly compounding)?
A)$111 978.54
B)$111 144.95
C)$9 950.11
D)$109 978.54

Question

Quizplus · Accepted Answer

The present value of an annuity due is calculated using the formula for the present value of an ordinary annuity, adjusted for the fact that payments are made at the beginning of each period. The correct calculation results in $111,978.54.

What Is the Present Value of an Annuity Due of $1000