Question

How do I solve this? What formula?

Aaron has an annuity that pays him $9200 at the beginning of each year. Assume the economy will grow at a rate of 3.2% annually. What is the value of the annuity if he received it now instead of over a period of 10 years?
1)
$109,850.52


2)
$106,444.30


3)
$77,682.00


4)
$80,168.75

I chose #4 but I want to be sure.

Answer 1

Explanation:

Answer 2

Yeah your answer was correct because the present value of annuity due is
PVAD=9,200×(((1−(1+0.032)^(−10))
÷(0.032))×(1+0.032))
=80,168.75

Hope it helps