fin 200 question
posted by meshelle on .
Jean will receive $8,500 per year for the next 15 years from her trust. If a 7% interest rate is applied, what is the current value of the future payments? Describe how you solved this problem, including which table (for example, present value and future value) was used and why.
is this right?
I think If Jean will earn $8,500. per year for the next 15 years from her trust and the interest rate will be seven percent of the current value of the future payments will b$5.95. You would take the $8,500. x $5.95= $50,575. The answer would then be multiplied by $5.75 until you go through all fifteen years to get how much Jean would receive in fifteen years. I used the future value single amount to get the answer. This showed how to get the answer every year for years and what to multiply for years
I am in this class also. In the forum with the course materials and syllabus there are Appendixes. You will need to look under the Appendix for current value to give you the correct rate to multiply $8500 by. It didn't make sense to me either? I also looked in the Library under Student Finance Lab. There are a lot of post from other students having problems as well. This might help.