- 2 Consider An Annuity Due Of 800 Paid Every Other Month For 10 Years A Let J Be The Effective Monthly Interest Rate 1 (82.01 KiB) Viewed 34 times
2. Consider an annuity-due of $800 paid every other month for 10 years. (a) Let j be the effective monthly interest rate
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2. Consider an annuity-due of $800 paid every other month for 10 years. (a) Let j be the effective monthly interest rate
2. Consider an annuity-due of $800 paid every other month for 10 years. (a) Let j be the effective monthly interest rate. Find an expression for the present value of this annuity using actuarial symbols in terms of j. (b) Let k be the effective two-month interest rate. Find an expression for the present value of this annuity using actuarial symbols in terms of k. (c) Using the previous definitions, suppose j = 3%. Find k. (d) Using your result from part (c), show that the expressions in part (a) and (b) are numerically equivalent.