Calculate the annual cash flows (annuity payments) from a fixed-payment annuity

Question

Calculate the annual cash flows (annuity payments) from a fixed-payment annuity if the present value of the 20-year annuity is $1.4 million and the annuity earns a guaranteed annual return of 13 percent. The payments are to begin at the end of the current year. (Do not round intermediate calculations. Round your answer to 2 decimal places. (e.g., 32.16))

Calculate the annual cash flows (annuity payments) from a fixed-payment annuity if the present value of the 20-year annuity is $1.4 million and the annuity earns a guaranteed annual return of 13 percent. The payments are to begin at the end of six years. (Do not round intermediate calculations. Round your answer to 2 decimal places. (e.g., 32.16))

What is the amount of the annuity purchase required if you wish to receive a fixed payment of $230,000 for 20 years? Assume that the annuity will earn 13 percent per year. (Do not round intermediate calculations. Round your answer to 2 decimal places. (e.g., 32.16))

Calculate the annual cash flows (annuity payments) from a fixed-payment annuity if the present value of the 20-year annuity is $1.4 million and the annuity earns a guaranteed annual return of 13 percent. The payments are to begin at the end of the current year. (Do not round intermediate calculations. Round your answer to 2 decimal places. (e.g., 32.16))

Explanation / Answer

a) $ 199,295.30

b) $ 462,473.30

c)

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