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What is the future value of an ordinary annuity of 12000 per year for three years at 9 percent interest compounded annually?
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∙ 9y ago
COMPOUND INTEREST FORMULA A = P(1 + r/n)^(nt) A = amount of money accumulated after n years, at r interest rate = to be determined P = principal; initial amount = $12,000 n = number of times the interest is compounded per year = 1 r = annual rate of interest, as a decimal = 9% = 0.09 t = time; number of years = 3 A = $12,000(1 + 0.09/1)^(1 x 3) A = $12,000(1 + 0.09)^3 A = $12,000(1.09)^3 A = $12,000(1.295029) A = $15,540.35 ANSWER
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∙ 9y ago
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When does interest begins compounding in an ordinary annuity?
At the end of the second period
What is the formula for present value of ordinary annuity?
A = Present ValueR = Amount of Ordinary Annuityj = %t = termm = periods (annually/ semi-annually/ quarterly)i = j/mn = tmA = R {[1-(1+i)-n] /i}Formula of present valueIf I have the decision to take 1,000,000 in a lump sum or 80,000 ordinary annunity for the next 30 years at 8% interest rate, which of the two opitions should I take and why?
Determine the future value of an annuity into which quarterly deposits of 450 are made for 9 years if the annuity pays 10 percent compounded quarterly?
138645
On a 5000 annuity compounded daily what would be the annual percentage rate?
Depends on the daily percentage rate.
What is the present value of a 30 year annuity with payments of 800 per year if interest rates are 12 percent annually?
The PV of a 30 year 800 per year annuity is 6,444 if the payment is received at the end of the year and 7,217 is the payment is received at the start of the year
What is the future value on an ordinary annuity of 12000 dollars per year for three years at 9 percent interest compounded annually?
39,337.20
What gains more interest an ordinary annuity or an annuity due?
ordinary annuity
An annuity pays out 20000 per yer in perpetuity if the intereset rate is 5 percent compounded annually find the presenet value of the whole annuity?
400000
When does interest begins compounding in an ordinary annuity?
At the end of the second period
What is the formula for present value of ordinary annuity?
A = Present ValueR = Amount of Ordinary Annuityj = %t = termm = periods (annually/ semi-annually/ quarterly)i = j/mn = tmA = R {[1-(1+i)-n] /i}Formula of present valueIf I have the decision to take 1,000,000 in a lump sum or 80,000 ordinary annunity for the next 30 years at 8% interest rate, which of the two opitions should I take and why?
What The differences between ordinary annuity and annuity due?
ordinary annuity we paid at the end of the period annuity due we paid at the begging of the period
What The difference between ordinary annuity and annuity due?
ordinary annuity we paid at the end of the period annuity due we paid at the begging of the period
What is the difference between ordinary annuity and annuity due?
In an ordinary annuity, the payments are fed into the investment at the END of the year. In an annuity due, the payments are made at the BEGINNING of the year. Therefore, with an annuity due, each annuity payment accumulates an extra year of interest. This means that the future value of an annuity due is always greater than the future value of an ordinary annuity.When computing present value, each payment in an annuity due is discounted for one less year (because one of the payments is not made in the future- it is made at the beginning of this year and is already in terms of present dollars). This will result in a larger present value for an annuity due than for an ordinary annuity, as well.
Is the cash accumulation in an annuity tax free?
No. The interest on a deferred annuity is tax-DEFERRED. That is, it is not taxed until it is distributed, at which point it will be taxed as Ordinary Income. (NO annuity EVER received Capital Gains treatment under current law).
Differentiate between ordinary annuity and annuity due?
In an ordinary annuity, the annuity payments are fed into the investment at the END of the year. In an annuity due, the payments are made at the BEGINNING of the year. Therefore, with an annuity due, each annuity payment accumulates an extra year of interest. This means that the future value of an annuity due is always greater than the future value of an ordinary annuity.When computing present value, each payment in an annuity due is discounted for one less year (because one of the payments is not made in the future- it is made at the beginning of this year and is already in terms of present dollars). This will result in a larger present value for an annuity due than for an ordinary annuity, as well.
What is the difference between ordinary annuities and annuities due?
An annuity due is an annuity where the payments are made at the beginning of each time period; for an ordinary annuity, payments are made at the end of the time period. *an annuity due of (n) periods is equal to an ordinary annuity of (n-1) periods plus the payment.
Will you earn a higher interest rate with a variable annuity than with a fixed annuity?
Yes, you do earn a higher interest rate with a variable annuity than with a fixed annuity. It depends on what kind of interest rate you have at the moment.
