An investor is to receive an annuity of $19,260 for six years commencing at the end of year 1. It has a present value of $86,400.
What is the rate of interest (to the nearest whole percent)?
________ %
The correct answer is: 9%
Annuity
Annuity factor
4.486
From tables, this annuity factor corresponds to an interest rate of 9% over six years.
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