Robben Company is considering investing in an annuity contract that will return $40,000 annually at the end

Question:

Robben Company is considering investing in an contract that will return $40,000 annually at the end of each year for 15 years. What amount should Robben Company pay for this investment if it earns an 8% return?

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,...