2 years ago

Susanne is going to college and was informed that she will get a grant to pay for

Mathematics

1 answer:

Yakvenalex [24]2 years ago

7 0

Answer:

what are the options????

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mylen [45]

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The value of annuity is $P_v = \$ 7929.9$

Step-by-step explanation:

From the question we are told that

The periodic payment is $P = \$ 250$

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Frequency at which it occurs in a year is n = 4 (quarterly )

The number of years is $t = 10 \ years$

The value of the annuity is mathematically represented as

$P_v = P * [1 - (1 + \frac{r}{n} )^{-t * n} ] * [\frac{(1 + \frac{r}{n} )}{ \frac{r}{n} } ]$ (reference EDUCBA website)

substituting values

$P_v = 250 * [1 - (1 + \frac{0.05}{4} )^{-10 * 4} ] * [\frac{(1 + \frac{0.05}{4} )}{ \frac{0.08}{4} } ]$

$P_v = 250 * [1 - (1.0125 )^{-40} ] * [\frac{(1.0125 )}{0.0125} ]$

$P_v = 250 * [0.3916 ] * [\frac{(1.0125)}{0.0125} ]$

$P_v = \$ 7929.9$

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