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Studying for an exam, please show your work so I can follow along! Mr....

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Studying for an exam, please show your work so I can follow along!

Mr. Encino's investment advisor has offered him an opportunity to invest in an annuity that will pay him $2,000 every quarter for the next 20 years. The projected return is 8%. What is the purchase price, or PV, of this annuity? a. Subsequently, another advisor offered Mr. Encino an annuity paying 10% over 20 years but he only needs $2,000 per quarter. What is the price, or PV, of this annuity? b. The company offering the 8% return has a credit rating of AA- and the company offering the 10% rate has a credit rating of BB. What annuity would you recommend and why

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