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26 August, 16:23

Your employer contributes $60 a week to your retirement plan. assume you work for your employer for another 20 years and the applicable discount rate is 9 percent. given these assumptions, what is this employee benefit worth to you today?.

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  1. 26 August, 17:40
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    Present value annuity will be given by:

    PVA=P[1 - (1+r) ^-n]/r

    where:

    PVA=present value annuity

    P=periodic paymeny

    r=rate per period

    n=number of periods

    substituting the value we get

    PVA=60*[1-{1 / (0.09/52) ]^20}) / (0.09/52) ]

    this will give us:

    $28,927.38
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