Explanation:
To calculate the annuity payment for each of the given scenarios, we can use the formula for the present value of an ordinary annuity:
Annuity Payment = Future Value / [(1 - (1 + r)^(-n)) / r]
Where:
Future Value = Future value of the annuity
r = Interest rate per period (in decimal form)
n = Total number of periods
Let's calculate the annuity payment for each scenario:
Scenario 1:
Future Value = $25,850
Year = 8
Interest rate = 8% (0.08 as a decimal)
Annuity Payment = $25,850 / [(1 - (1 + 0.08)^(-8)) / 0.08]
Scenario 2:
Future Value = $1,130,000
Year = 43
Interest rate = 10% (0.10 as a decimal)
Annuity Payment = $1,130,000 / [(1 - (1 + 0.10)^(-43)) / 0.10]
Scenario 3:
Future Value = $976,000
Year = 29
Interest rate = 11% (0.11 as a decimal)
Annuity Payment = $976,000 / [(1 - (1 + 0.11)^(-29)) / 0.11]
Scenario 4:
Future Value = $149,000
Year = 16
Interest rate = 7% (0.07 as a decimal)
Annuity Payment = $149,000 / [(1 - (1 + 0.07)^(-16)) / 0.07]
After performing the calculations, you will obtain the annuity payment for each scenario.
I hope I was helpful