All formulae

Question 1

When calculating the NPV of a an annuity using the annuity table what must you not forget to do?

Answer 1

You CANNOT do C/K * (Value from Table).You MUST do C * (Value from Table)

Question 2

What MUST we always remember when doing delayed annuity or perpetuity formulas?

Answer 2

You must always discount by n-1 (n being the amount years till the first payment starts) because we always start at Year 0