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What is the present value of annuity

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Your friend agrees to pay you $1,000 every month for the next 12 months. The first payment will be one month from today. The relevant effective annual interest rate is 12.36%. What is the present value of this annuity?

A firm is thinking whether to carry on with an investment project that requires an initial outlay of USD 100,000. The after-tax cash inflows are estimated to amount to USD 20,000 at the end of the first and second year and to USD 30,000 at the end of the third, fourth, and fifth year. The required rate of return for the project is 4.4%. calculate NPV for the project?

Reference no: EM132483987

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