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Abby Mia wants to know how much must be deposited in her local bank today so that she will receive yearly payments of $18,000 for 20 years at a current rate of 9% compounded annually. (Use the tables in the handbook.)

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Answer:

$164,313.82

Explanation:

In this question we have to apply the present value formula i.e to be shown in the attachment

Provided that,  

Future value = $0

Rate of interest = 9%

NPER = 20 years

PMT = $18,000

The formula is shown below:

= -PV(Rate;NPER;PMT;FV;type)

So, after applying the above formula the present value is $164,313.82

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