Problema Solution
Find the present value of the ordinary annuity. (Round your answer to the nearest cent.)
$150/month for 10 yr at 9%/year compounded monthly
Answer provided by our tutors
let;
i=9/12=0.75;
n=10*12=120;
annuity=150[(1+i)^n -1]/i;
from this formula, annuity for each month can be calculated and them summed up to get the fina answer.