An annuity consists of payments of $450 made at the beginning of every month for 5 years. If the annuity earns 6% compounded semiannually, calculate present value.

Annuity

A financial service that offers a continual payment stream to its holder, primarily aimed at funding the post-retirement life of individuals.

Compounded Semiannually

Interest that is calculated and added to the principal twice a year, leading to interest on interest.

Present Value

The contemporary value of a future monetary sum or cash flow stream, calculated with a set rate of return.