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Question
Choose the correct alternative :
Amount of money today which is equal to series of payments in future is called
Options
Normal value of annuity
Sinking value of annuity
Present value of annuity
Future value of annuity
Solution
Amount of money today which is equal to series of payments in future is called Present value of annuity.
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RELATED QUESTIONS
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Choose the correct alternative :
Rental payment for an apartment is an example of
______ is a series of constant cash flows over a limited period of time.
Choose the correct alternative :
A retirement annuity is particularly attractive to someone who has
Fill in the blank :
The person who receives annuity is called __________.
State whether the following is True or False :
Payment of every annuity is called an installment.
Solve the following :
Find the rate of interest compounded annually if an ordinary annuity of ₹20,000 per year amounts to ₹41,000 in 2 years.
State whether the following statement is True or False:
The relation between accumulated value ‘A’ and present value ‘P’ is A = P(1+ i)n
State whether the following statement is True or False:
An annuity where payments continue forever is called perpetuity
The present value of an immediate annuity for 4 years at 10% p.a. compounded annually is ₹ 23,400. It’s accumulated value after 4 years would be ₹ ______
A company decides to set aside a certain sum at the end of each year to create a sinking fund, which should amount to ₹ 4 lakhs in 4 years at 10% p.a. Find the amount to be set aside each year?
[Given (1.1)4 = 1.4641]
