Question: How can you use the present value of an annuity
How can you use the present value of an annuity concept to determine the price of a house you can afford?
Answer to relevant QuestionsSince perpetuity payments continue forever, how can a present value be computed? Why isn’t the present value infinite?Compute the future value in year 9 of a $2,000 deposit in year 1 and another $1,500 deposit at the end of year 3 using a 10 percent interest rate.What is the present value of a $700 annuity payment over six years if interest rates are 10 percent?A small business owner visits his bank to ask for a loan. The owner states that he can repay a loan at $1,500 per month for the next three years and then $500 per month for two years after that. If the bank is charging ...What annual interest rate would you need to earn if you wanted a $1,000 per month contribution to grow to $75,000 in six years?
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