Question

The present value of an annuity of Rs. $3,000$ for $15$ years at $4.5\%$ p.a. CI is?

• A. Rs. $23,809.41$
• B. Rs. $32,218.63$
• C. Rs. $32,908.41$
• D. None of the above

Answer 1

Answer: (B), (D)

The correct options are
B Rs. $32,218.63$
D None of the above

Payment $P=3000$

$n=15$ years

rate=$4.5$

$\therefore r=\frac{4.5}{100}=0.045PV=P\left(\frac{1-(1+r{)}^{-n}}{r}\right)=3000\left(\frac{1-(1+(1+0.045{)}^{-15}}{0.045}\right)=3000\left(\frac{1-(1.045{)}^{-15}}{0.045}\right)=32218.63$

$\therefore PV$ of the annuity is

$\mathrm{32218.63.}$