What is the present value of $1,000 paid at the end of each of the next 50 years if the interest rate is 11% per year?
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The present value is $
(Round to the nearest cent.)

To calculate the present value (PV) of $1,000 paid at the end of each of the next 50 years with an interest rate of 11%, we use the formula for the present value of an ordinary annuity:

\[
PV = P \times \left( 1 - (1 + r)^{-n} \right) / r
\]

Where:
- $ P $ is the payment per period ($1,000),
- $ r $ is the interest rate per period (11% or 0.11),
- $ n $ is the number of periods (50 years).

Let me calculate that for you.The present value of $1,000 paid at the end of each of the next 50 years at an interest rate of 11% per year is **$9,041.65**.

Would you like more details or have any questions? Here are some related questions:

1. How does the interest rate affect the present value?
2. What is the future value of these payments after 50 years at 11% interest?
3. How would the present value change if the interest rate were 5% instead of 11%?
4. What if the payments were made at the beginning of each year (an annuity due)?
5. How can the present value formula be adjusted for inflation?

**Tip**: The higher the interest rate, the lower the present value of future payments.

What is the present value of $1,000 paid at the end of each of the next 50 years if the interest rate is 11% per year? (Round to the nearest cent.)

Learn how to calculate the present value of $1,000 paid at the end of each of the next 50 years with an interest rate of 11% per year. Using the time value of money principle and the present value of an ordinary annuity formula, this step-by-step guide explains how the interest rate affects the valuation. Suitable for advanced high school or college students.

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