PVAn = R/(1 + i)1 + R/(1 + i)2

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9780273713654 pp03 PVAn = R/(1 + i)1 + R/(1 + i)2 PVAn = R/(1 + i)1 + R/(1 + i)2 + ... + R/(1 + i)n Overview of an Ordinary Annuity – PVA PVA3 = $1,000/(1.07)1 + $1,000/(1.07)2 + $1,000/(1.07)3 PVA3 = $1,000/(1.07)1 + $1,000/(1.07)2 + $1,000/(1.07)3 = $934.58 + $873.44 + $816.30 = $2,624.32 Example of an Ordinary Annuity – PVA Cash flows occur at the end of the period The present value of an ordinary annuity can be viewed as occurring at the beginning of the first cash flow period , whereas the future value of an annuity due can be viewed as occurring at the end of the first cash flow period. The present value of an ordinary annuity can be viewed as occurring at the beginning of the first cash flow period, whereas the future value of an annuity due can be viewed as occurring at the end of the first cash flow period. Hint on Annuity Valuation PVAn = R (PVIFAi%,n) PVA3 = $1,000 (PVIFA7%,3) = $1,000 (2.624) = $2,624 N: 3 Periods (enter as 3 year-end deposits) I/Y: 7% interest rate per period (enter as 7 NOT .07) PV: Compute (Resulting answer is positive) PMT: $1,000 (negative as you deposit annually) FV: Not relevant in this situation (no ending value) Chia sẻ với bạn bè của bạn: