Suppose you are going to receive $14,500 per year for five years. The appropriate interest rate is 8 percent. a-1. What is the present value of the payments if they are in the form of an ordinary annuity

PV of annuity = $57894.29554 rounded off to $57894.30

Explanation:

An annuity is a series of cashflows that are of constant amount, occur after equal intervals of time and are for a finite/limited time period. An ordinary annuity is a kind of annuity where cash flows occur at the end of each period. The formula to calculate the present value of an annuity is attached.

PV annuity = 14500 * [ (1 - (1+0.08)^-5) / 0.08]

PV of annuity = $57894.29554 rounded off to $57894.30

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1. The reference should not be a relative.

2. It is best to have past employers, teachers, club advisors, or others who can speak about your characteristics.

3. You should ask each reference for their permission. This lets them know that they may get a phone call about you and gives them time to prepare to talk about you.