What is the present value of a five-period annuity of $3,000 if the interest rate per period is 12% and the first payment is made today?
A) $9,655.65
B) $10,814.33
C) $12,112.05
D) $13,200.00

Name: What is the present value of a five-period annuity of $3,000 if the interest rate per period is 12% and the first payment is made today? A) $9,655.65 B) $10,814.33 C) $12,112.05 D) $13,200.00
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Quizplus · Accepted Answer

PV_AD = PV_OA × (1 + r)PV_AD = {$3,000[1 / 0.12 − 1 / 0.12(1.12)⁵]} × 1.12PV_AD = $12,112.05

What Is the Present Value of a Five-Period Annuity of $3,000