You own a contract that promises an annuity cash flow of $100 beginnin

You own a contract that promises an annuity cash flow of $100 beginning-of-the-year cash flows for each of the next three years (note: the first cash flow is today).

At an interest rate of 10%, what is the future value of this contract exactly three years from today?
A) $248.69
B) $273.55
C) $331.00
D) $364.10

ANSWER

D
Explanation: D) Via Calculator: N = 3, I = 10, PV = ), PMT = $100, Set to “Begin”, solve for FV = $364.10.