If you want to be paid from a 12 year ordinary annuity with a guaranteed rate of 7.182% compounded annually, how much should you pay for one of these annuities if you want to receive annual payments of $9,000.00 over the 12 year period? Principal = $
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- The annuity has a term of 12 years. - The annual interest rate is 7.182%, compounded annually. - The annual payment is $9,000. We need to find the present value (principal) of this annuity. The formula for the present value of an ordinary annuity is: $PV = Show more…
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