Q1: payments of $ 670 are being made at the end of each month for 5 years at an interest of 8% compounded monthly. calculate the present value.

The present value is  $ 26943.69

Step-by-step explanation:

Given as :

The amount paid at the end of  each month = $ 670

The time period = 5 years = 12 ×5 = 60 months

So , The total amount paid for the 60 months = $ 670 × 60 = $ 40200

The rate of interest applied compounded monthly = 8 %

Let The present value = $ P

From compounded method

Amount = Principal ×

Or, $ 40200 = P  ×

Or, $ 40200 = P  ×

Or, $ 40200 = P  × 1.492

∴ P = = $ 26943.69

Hence The present value is  $ 26943.69  Answer

9

step-by-step explanation: