What is the present value of a $700 annuity payment over 6 years with a 10% interest rate?

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asked Aug 10, 2018 61.3k views

1 Answer

Agnieszka Polec · Answer 1 · 2018-08-16T07:27:49+0000

Hi there
The formula of the present value of annuity ordinary is
Pv=pmt [(1-(1+r)^(-n))÷r]
Pv present value?
PMT 700 payment per year
R interest rate 0.1
N time 6 years
So
Pv=700×((1−(1+0.1)^(−6))÷(0.1))
pv=3,048.68

Hope it helps

What is the present value of a $700 annuity payment over 6 years with a 10% interest rate?

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