Find the common present value of the two annuities

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Reference no: EM13731452

Al is given a fifteen-year annuity with end-of-year payments. The first payment Al receives, precisely one year from the date he is given the annuity, is for $100, and then subsequent payments decrease by 4% annually. Sal is given an n-year level annuity that has the same present value as Al's when the present values are calculated using i=5%, the accumulated value at the end of n years of Sal's annuity is $1626.29. Find the common present value of the two annuities and then find n.

Reference no: EM13731452

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