Question

An account paying 3.2% interest compounded semiannually has a balance of $32,675.12. determine the amount that can be withdrawn from the account semiannually for 5 years. assume ordinary annuity and round to the nearest cent. a. $3,505.80 b. $3,561.90 c. $3,039.09 d. $2,991.23

Answer 1

Ordinary annuity, rounded up to the nearest cent, and $3,561.90.

What is common annuity recipe?

The formula for an ordinary annuity is provided below. The Present Value of an Ordinary Annuity at the Beginning is equal to r * P / 1 – (1+r)-(n-1) The Present Value of an Ordinary Annuity at the End is equal to r * P / 1 – (1+r)-(n)

What distinguishes a due annuity from an ordinary one?

An annuity that has a payment due or made at the beginning of the payment interval is called a due annuity. An ordinary annuity, on the other hand, pays out at the end of the term. Therefore, the approach to determining the present and future values differs.

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