Problem 6.48 – Present Value Calculation for an Annuity with Changing APRs

Fundamentals of Corporate Finance

Ross, Westerfield, and Jordan

13th Edition

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Difficulty – Medium

Calculate the present value of a 15-year annuity that pays $1,750 per month, with payments made at the end of each month. The annuity earns an APR of 9% compounded monthly for the first seven years, and an APR of 6% compounded monthly thereafter. (Your numbers will vary)

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