The Present Value of an Ordinary Annuity of $2,350 Each

question 86

Multiple Choice

The present value of an ordinary annuity of $2,350 each year for eight years, assuming an opportunity cost of 11 percent, is ________ .

• A) $18,800
• B) $12,093
• C) $27,869
• D) $ 1,020

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Definitions:

Net Income

The net income of a company following the subtraction of all costs and taxes from the gross revenue.

Cash Dividend

A cash dividend is a payment made by a company out of its profits to shareholders in the form of cash.

Annual Financial Statements

Reports that give an overview of a company's financial condition for a specific fiscal year, including income statements, balance sheets, and cash flow statements.

December 31

The last day of the year in the Gregorian calendar, often used as the end date for annual financial statements.