2) Your aunt has offered to give you $10,000 when she retires in seven years. You...

 

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2) Your aunt has offered to give you $10,000 when she retires in seven years. You have decided that you would prefer to have equal annual amounts in years 1-10. a) If your aunt's discount rate is 5%, what would the amounts be? b) Find a second way of calculating those equal annual amounts. Does it yield the same result? If not, which one do you believe? 2) Your aunt has offered to give you $10,000 when she retires in seven years. You have decided that you would prefer to have equal annual amounts in years 1-10. a) If your aunt's discount rate is 5%, what would the amounts be? b) Find a second way of calculating those equal annual amounts. Does it yield the same result? If not, which one do you believe?

Answer rating: 100% (QA)

a To calculate the equal annual amounts using the annuity formula we can use the form... View the full answer