"ORDINARY DEFERRED ANNUITY, AMOUNT and PRESENT VALUE vs PAYMENT.An ANNUITY is a series of equal payments made at equal intervals. PAYMENT INTERVAL is the time between successive payments. TERM is time from beginning of first payment interval to the end of the last payment interval. SIMPLE CASE: payment interval and interest period coincide. ANNRATE% is the nominal annual interest rate. NUMYEARS is the term in years starting at first payment. DEFYEARS is the number of deferred years before the first payment. PAYMNINT is the payment interval in months. PERPAYMN is the periodic payment. FREQCONV is the number of intervals in one year. PRESVALU is annuity's value today. *** Answers to problems *** (c) Copyright PCSCC, Inc., 1993 (a) Set ANNRATE%=7.5, DEFYEARS=5, NUMYEARS=20, PAYMNINT=12, PERPAYM=900. The present value (PRESVALU)is $7,017.86. If this sum is deposited into the fundtoday, then $900 will be available in 5 years and in each year thereafter for the remaining 20 years. Type any key to exit. ||(a) A newly built tractor shed will need repairs at the end of 5 years when $900 will be required for painting. After that, $900 will be neededeach year for 20 years. Find the present value of the upkeep fund if money is worth 7.5%. Type comma key to see answers. Type (F2) to return to help file."
