Find the present value of an ordinary annuity of $600 payments each made quarterly over 5 years and earning interest at 4% per year compounded quarterly.

Answer 1

quarterly rate = .04/4 = .01
number of payments = 5(4) = 20

PV = payment (1 - (1+i)^-n)/i
600( 1 - 1.01^-20 )/.01
= $10837.33