You Are Comparing Two Annuities with Equal Present Values

question 162

Multiple Choice

You are comparing two annuities with equal present values. The applicable discount rate is 4.5%. One annuity pays $2,000 each month for twenty years, starting today. How much does the second
Annuity pay each month for twenty years if it will pay the first payment one month from today?

• A) $2,007.50
• B) $2,008.75
• C) $2,009.00
• D) $2,009.50
• E) $2,010.00

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