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Find the present value of an annuity due that pays $3000 at the beginning of each quarter for the next 5 years. Assume that money is worth 6.6%, compounded quarterly. (Round your answer to the nearest cent.)

Respuesta :

Answer:

present value due to annuity is A = $4161.68

Step-by-step explanation:

present value = $3000

For quarterly  time will be   = 5 years

                                            = 5 × 4

                                             =  20

interest rate = 6.6 %

                    = 6.6/4  

                    = 1.65 %

hence,

[tex]A = P(1+\dfrac{r}{100})^t[/tex]

[tex]A = 3000\times (1+\dfrac{1.65}{100})^{20}[/tex]

A = $4161.68

hence, the present value due to annuity is A = $4161.68

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