1. You are considering an annuity which costs $89,500 today. The annuity pays $5,600 a year. The rate of return is 4 percent. What is the length of the annuity time period? (Do not round intermediate calculations.)
2.88 years
15.98 years
7.69 years
13.00 years
26.00 years
2. You are scheduled to receive annual payments of $11,200 for each of the next 20 years. Your discount rate is 11 percent. What is the difference in the present value if you receive these payments at the beginning of each year rather than at the end of each year?
$10,232
$11,200
$10,948
$12,432
$9,811