Question

Sheela needs rs 100000 at the end of each year in the next 5 years.how much amount she should invest now @10% present value of annuity factor at 10%for 5 years is 3.7908

Answer 1

hey the right answer is  379080

Answer 2

This question is simple given that we have been given the present value annuity factor.

The present value is given by:

Let PV represent the present value and X the annuity.

The present value is given by :

PV = X × The annuity factor

We do this substitution in the question as follows :

X = 100000

We work out as follows :

100000 × 3.7908

= 379080

Sheela needs to invest 379080 now in order to get 100000 at the end of each year.