Define annuity and discuss why annuity is so important

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1. Define an annuity and discuss why an annuity is so important when buying a car, buying a home or in a retirement plan, especially in the life of people that are not economically wealthy?

2. The March Madness Company just paid an annual dividend of $2.87. If you expect a constant growth rate of 3.95 percent, and have a required rate of return of 13.20 percent, what is the current stock price according to the constant growth dividend model?

Round the answer to two decimal places.

Reference no: EM131954161

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