lOMoARcPSD|9666799

Assignment on Annuity (Ordinary)

Engineering Economy (Technological Institute of the Philippines)

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 lOMoARcPSD|9666799

Deter
minethepresentwort
handtheaccumulat
edamountofanannui
tyconsi
st
ingof6
paymentsofP120,000each.Thepaymentar
emadeatthebeginni
ngofeachyearand
moneyisworth15% compoundedannuall
y.
Gi
ven: For
mul
aandSol
uti
on:

[ ]
− ( n−1)
1−( 1+i )
A=120,000 P= A 1+
i

[ ]
− ( 6−1)
1−( 1+0.15 )
r=15 %∨0.15 P=120,000 1+
0.15

m=1 P=120,000 1+ [
1−( 1+0.15 )−5
0.15 ]
n=6 P=120,000 1+ [
1−( 1+0.15 )−5
0.15 ]
P=522, 258.6118∨522,25
Accumul
atedamount
:

F=A [ i ]
(1+i )n −1
(1+i)

F=120,000 [
( 1+0.15 )6 −1
0.15 ]
(1+ 0.15)

F=1,208, 015.904∨1, 208,016

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