Question

g You have a choice of two investment accounts. Investment A is a 15-year annuity with $1,500 payments at the end of each month and a rate of 6%, compounded monthly. Investment B is a lump-sum investment with an interest rate of 7%, compounded continuously for 15 years. How much money would you need to invest in Investment B today for it to be worth as much as Investment A 15 years from now

Answer 1

Answer:

How much money would you need to invest in Investment B today for it to be worth as much as Investment A 15 years from now

325.266.310,1

Explanation:

n=15*12

n=180

FV=A( 1 + i )^ n -1 / i

FV=1500( 1 + 0,06)^ 180 - 1 / 0,06

FV= 897,395,025.40

PV=FV/(1+I)^ n

    =897,395,025.40/ (1+0.07)^ 15

    =325.266.310,1