An Annuity Pays $12 Per Year for 100 Years

question 48

Multiple Choice

An annuity pays $12 per year for 100 years.What is the present value (PV) of this annuity given that the discount rate is 8%?

• A)$144.62
• B)$146.63
• C)$149.93
• D)$151.45

Understand the rationale behind preferring current money over future money in financial decisions.

Understand and apply the concept of compound interest and its calculations for various compounding frequencies.

Analyze and compare different savings and investment options including GICs, RRSPs, and loans.

Calculate the future value of investments with varying rates, terms, and compounding periods.

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Definitions:

Fraudulent

Involves intentional deception to secure unfair or unlawful gain, or to deprive a victim of a legal right.

Institute Of Management Accountants

A professional organization focused on advancing the management accounting profession through research, education, and certification programs.

Ethical Professional Practice

The set of principles and standards that guide the behavior and decision-making of professionals to ensure integrity, fairness, and respect.

Period Costs

Expenses that are not directly tied to the production of goods and are instead expensed in the period they are incurred.