7 Your friend promises you an annuity of 30 payments. If the firstpayment occurs in year 1, the interest rate is 10% and the presentvalue at year zero for the promise is $500, which of the following isright about the payment at year 10?O a. $16.27O b. $19.27O c. $47.93O d. $80.85e.None of the above

Present value The value of future money at the present is known as the present value of money. The…

Answered: payment occurs in year 1, the interest…

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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payment occurs in year 1, the interest rate is 10% and the present value at year zero for the promise is $500, which of the following is right about the payment at year 10? O a. $16.27 O b. $19.27 O c. $47.93 O d. $80.85 O e. None of the above