How Much Must Be Invested Today in Order to Generate

question 53

Multiple Choice

How much must be invested today in order to generate a five-year annuity of $1,000 per year, with the first payment one year from today, at an interest rate of 12 percent?

• A)$3,604,78
• B)$3,746.25
• C)$4,037.35
• D)$4,604.78 PV =