"GENERAL ANNUITIES CERTAIN, NUMBER PERIODS, TERM and AMOUNT. An ANNUITY is a series of equal payments made at equal intervals. ORDINARY ANNUITY CERTAIN is one in which payments are made at ends of intervals. GENERAL CASE: payment interval and interest period do not coincide. ANNRATE% is the nominal annual interest rate. NUMYEARS is the term in years. PAYMNINT is the payment interval in months and INTINTER isthe interest interval in months. PERPAYMN is the periodic payment at PAYMNINT and INTPAYMN is the periodic payment at INTERINT. FREQCONV is number of interest intervals in one year. VALUANNU is accumulated value of annuity at term. PRESVALU is the annuity's value today. ANNURENT is the annual payment. In the GENERAL CASE, the current periodic payment PERPAYMN is converted into a new periodic payment INTPAYMN at the interest interval INTERINT. If SPLITFAC > 1 then it is called COMBINING FACTOR, If SPLITFAC < 1, SPLITTING FACTOR. *** Answer to Problem *** (c) Copyright PCSCC, Inc., 1993 (a) Set ANNRATE%=7, INTERINT=3 (3 mo in 1/4 yr.), PAYMNINT=12 (12 mo in yr), PERPAYMN=1000, VALUANNU=150,000. NPERIODS is apporx 142 or 35.5 years. (b) As above. Move cursor to PERPAYMN. Type S, then (esc) NPERIODS (ent), then (esc) 144 (ent), then (ent). For 144 periods (36 years), PERPAYMN=$965.79. Type any key to exit. ||(a) Approximately how many annual deposits of $1000 are needed to accumulate $150,000 if funds earn 7% compounded quarterly? (b) What periodic payment will result in an exact number of periodic payments? Type comma key to see answer. Type (F2) to return to helpfile."
