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Question

What happens to the present value of an annuity as the interest rate increases?

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Answered 1 year ago

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1 of 3The **Present Value of an Annuity** refers the amount of money that would be required today to fund a series of future annuity payments. This is based on the concept of the **time value of money** stating that a sum received now is worth more than at a later time.

The calculation of an annuity's present value will help to know if you'll get more money from taking a lump amount now or an annuity spread out over several years.

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