Find the present value of a 3 year, $20,000 ordinary annuity deposited into an account that pays 12 annual interest, compounded monthly Solve for the present value of the annuity in the following ways a As three single cash flows discounted at the stated annual rate of interest b As three single ca...

a PV 20000 X 101 12 20000 X 101 24 20000 X 10 ...

Find the present value of a 3-year, $20,000 ordinary annuity deposited into an account that pays 12%

Question:

Find the present value of a 3-year, $20,000 ordinary deposited into an account that pays 12% annual interest, compounded monthly. Solve for the present value of the in the following ways:
a. As three single cash flows discounted at the stated annual rate of interest
b. As three single cash flows discounted at the appropriate effective annual rate of interest
c. As a 3-year discounted at the effective annual rate of interest
Annuity
An annuity is a series of equal payment made at equal intervals during a period of time. In other words annuity is a contract between insurer and insurance company in which insurer make a lump-sum payment or a series of payment and, in return,...