Question

An annuity immediate pays 15 at the end of years 1 and 2, 14 at the end of years 3 and 4 and so on. The payments decrease by 1 every second year until nothing is paid. The effective annual interest rate is 6%. Calculate the present value of this annuity

Answer 1

$138.63

Step-by-step explanation:

I used an excel spreadsheet and the NPV function to determine the present value of this annuity. The present value of this annuity is $138.63