# calculation of present and future value of ordinary annuity

1. Present Values. Compute the present value of a $100 cash flow for the following combinations of discount rates and times:

1. r = 8 percent. t = 10 years.

2. r = 8 percent. t = 20 years.

3. r = 4percent. t = 10 years.

4. r = 4 percent. t = 20 years.

2. Future Values. Compute the future value of a $100 cash flow for the same combinations of rates and times as in problem 1.

6. Calculating Interest Rate. Find the interest rate implied by the following combinations of present and future values:

Present Value Years Future Value

$400 11 $684

$183 4 $249

$300 7 $300

https://brainmass.com/math/algebra/calculation-of-present-and-future-value-of-ordinary-annuity-127689

#### Solution Preview

Please see the attached file for the step-by-step solutions.

1. Present Values. Compute the present value of a $100 cash flow for the following combinations of discount rates and times:

1. r = 8 percent. t = 10 years.

2. r = 8 percent. t = 20 years.

3. r = 4percent. t = 10 years.

4. r = 4 percent. t = 20 years.

The Present Value of an Ordinary Annuity could be solved by calculating the present value of each payment in the series using the present value formula and ...

#### Solution Summary

The solution is comprised of detailed explanation of concept and calcuations of present value and future value of ordinary annuity.