What is the PV of an annuity due with 10 payments of $2,700 at an interest rate of 6.5%?
A)$20,671.48
B)$21,705.06
C)$22,790.31
D)$23,929.82

Question

Quizplus · Accepted Answer

The present value of an annuity due is calculated as the present value of an ordinary annuity multiplied by (1 + r), where r is the interest rate. In this case, the present value of an ordinary annuity with 10 payments of $2,700 at an interest rate of 6.5% is $20,671.48. Multiplying this by (1 + 0.065) gives us $21,705.06, which is the present value of the annuity due.

What Is the PV of an Annuity Due with 10