Explain compound value of an annuity, Financial Management

Assignment Help:

Q. Explain Compound Value of an Annuity?

Compound Value of an Annuity: - Annuity demotes to the periodic flows of equal amounts.

FV = A {(1+i)n - 1}/i

Instance: - Mr. X invests Rs. 2000 at the end of every year for 5 years into his account interest being 5% compounded annually. Conclude the amount of money he will have at the end of the 5th year.

FV = 2000 {(1+.05) 5- 1}/.05

FV = Rs. 11054


Related Discussions:- Explain compound value of an annuity

Contrast a benefit and a defined contribution pension plan, Compare and con...

Compare and contrast a defined benefit and a defined contribution pension plan. In defined benefit plan retirement remuneration are determined by a formula that typically

European community, European Community (EC) An economic alliance, evalu...

European Community (EC) An economic alliance, evaluated in 1957, designed to encourage trade and economic cooperation between its members.  The EC is also called the European

Budget setting styles, Advantages and disadvantage of pacipatory style of b...

Advantages and disadvantage of pacipatory style of budgeting

Mutual fund services, Mutual Fund Services: Financial Mutual Funds laun...

Mutual Fund Services: Financial Mutual Funds launch schemes to cater to the need of the different categories of investors. They provide special services in addition to the retu

What are the government securities - debt securities, What are the Governm...

What are the Government Securities Government is one of the biggest borrowers from capital and money market. We have already taken a look at money market securities offered by

Explain investment banks and securities firms, Investment banks and securit...

Investment banks and securities firms Investment banks support corporations or governments in the issue of new debt or equity securities. Investment banking comprises Th

Exam answers, Prepare your recommendation on Agarwal Cast Company

Prepare your recommendation on Agarwal Cast Company

Explain the three financial factors that influence the value, List and expl...

List and explain the three financial factors that influence the value of a business. The three factors that influence the value of a firm's stock price are timing , cash flow

Explain vernon’s product life cycle theory of fdi, Explain Vernon’s product...

Explain Vernon’s product life-cycle theory of FDI. What are the strength and weakness of the theory? Answer:  As to the product life-cycle theory, companies undertake FDI at a ce

Determine the analytical procedures of auditors, Analytical procedures of a...

Analytical procedures of auditors Auditors must apply analytical procedures at the planning and overall review stage of audit. Analytical procedures include the considerati

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd