Suppose the intrest rate is 8%APR on a monthly compounding. What is the present value which pays $95 every 6 months for 6 years.

To calculate the present value of a stream of cash flows, we need to discount each future cash flow to its present value using the given interest rate. In this case, we have an annual interest rate of 8% APR, which means the monthly interest rate is (8% / 12) or 0.67% per month.

The cash flows occur every 6 months for 6 years, which is a total of 12 payment periods (6 years * 2 payment periods per year). Each payment is $95.

To calculate the present value, we can use the formula for the present value of an annuity:

PV = PMT * [1 - (1 + r)^-n] / r

Where PV is the present value, PMT is the payment amount, r is the interest rate per period, and n is the number of periods.

In this case, PMT = $95, r = 0.67% (0.0067), and n = 12.

Now let's plug in the values into the formula and calculate the present value:

PV = $95 * [1 - (1 + 0.0067)^-12] / 0.0067

Using a calculator or spreadsheet, we find that the present value is approximately $1,025.12.