Answer:
PMT = $3875.00
Explanation:
given data
annuity selling = $14,427.59
time = 4 year
interest rate = 5 %
solution
we get here annual annuity payment that is express as
PMT = [tex]\frac{present\ value}{(1+r)*\frac{1-(1+r)^{-n}}{r} }[/tex] ..................................1
put here valuer and we get
PMT = [tex]\frac{14427.59}{(1+0.05)*\frac{1-(1+0.05)^{-4}}{0.05} }[/tex]
solve it now and we get
PMT = $3875.00
so here value of the annual annuity payment (PMT) is $3875.00
