Question

The present value of an annuity of R pesos payable annually for 8 years, with the first payment at the end of 10 years, is 187, 481.25. Draw the cash flow diagram and find the value of R if money is worth 5%.

Answer 1

$187,481.25*1.05^{9}=R*\frac{1-(1+0.05)^{-8}}{0.05}$

$R=45,000$