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FV of an ordinary annuity and annuity due

Felix edited this page Jun 6, 2014 · 1 revision

What is the future value of an ordinary annuity that pays $15,000 per year at the end of each of the next 25 years, given the investment is expected to earn a 6% rate of return?

fv.annuity(r = 0.06, n = 25, pmt = -15000, type = 0)
[1] 822968

What is the future value of an annuity that pays $10,000 per year at the beginning of each of the next three years, commencing today, if the cash flows can be invested at an annual rate of 5%?

fv.annuity(r = 0.05, n = 3, pmt = -10000, type = 1)
[1] 33101