Share
Explore BrainMass

Present Value

1. Which of the following should be used to calculate the amount of the equal periodic payments that could be equivalent to an outlay of $3000 at the time of the last payment?

a) Amount of 1
b) Amount of an annuity of 1
c) Present value of an annuity of 1
d) Present value of 1

(Please give reason for answer)

Solution Preview

Answer : c) Present value of an annuity of 1

We can show this by way of an example

Let the outlay at time 0= $3,000
No of equal periodic ...

Solution Summary

Answers a multiple choice question on Present Value.

$2.19