Asked by
Daniela Herrera Paz
on Nov 13, 2024
Verified
The present value of an annuity is the sum of the present values of each cash flow.
Present Value
Today's monetary worth of a prospective money sum or set of cash flow transactions, given a set rate of return.
Annuity
A finance option that grants a regular payment sequence to individuals, chiefly employed as income for retired persons.
Cash Flow
The complete total of funds entering and leaving a business, notably affecting its immediate financial resources.
- Understand the principles of present value and how they apply to evaluating bonds and calculating interest.
Verified Answer
CA
Learning Objectives
- Understand the principles of present value and how they apply to evaluating bonds and calculating interest.