Find the present value of $10,000 received at the start of every year for 20 years if the interest rate is J1 = 12% p.a. and if the first payment of $10,000 is received at the end of 10 years.
The working i have done is as shown below:
PV of Annuity Due = C * [ ( 1 - ( 1 +i ) ^ - n ) / i ] * ( 1 + i)
C = 10,000
i = 12%
n = 20
PV at Year 0 = PV at end of 10 years * 1 / (1.12 ^ 10) = 806,987.4 * 1 / (1.12)^10 = 259,828.3
is it correct????
The working i have done is as shown below:
PV of Annuity Due = C * [ ( 1 - ( 1 +i ) ^ - n ) / i ] * ( 1 + i)
C = 10,000
i = 12%
n = 20
PV at Year 0 = PV at end of 10 years * 1 / (1.12 ^ 10) = 806,987.4 * 1 / (1.12)^10 = 259,828.3
is it correct????