# Present Value of an Annuity (Annuity "OUT") $P=\frac{R[1-(1+\frac{i}{c})^{-tc}]}{(\frac{i}{c})}$

- 1How much should you deposit into an account now that pays 6% compounded semi-annually so that you can withdraw $700 every 6 months for 4 years? (What is the present value of the annuity?)
- 2How much should you deposit into an account now that pays 4% compounded quarterly so that you can withdraw $1000 every 3 months for 6 years? (What is the present value of the annuity?)
- 3How much should your parents deposit into an account now that pays 9% compounded monthly so that you can withdraw $500 every month for the 4 years that you are at university? (What is the present value of the annuity?)
- 4If you win $75,000 in a lottery and deposit it into an annuity, how much can you withdraw every 6 months if the account pays 2.75% compounded semi-annually for 10 years?
- 5If your grandparents invested $250,000 in an annuity for you, how much can you withdraw every 3 months if the account pays 3.5% compounded quarterly for 25 years?
- 6You plan to have $750,000 saved when you retire. How much can you withdraw every month if the account pays 6% compounded monthly for 30 years?

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