You are paid £2,500 annually for 6 years, with the first payment due in one year and the last payment due in 6 years. What is the present value of all these payments using an interest rate of 10%? £ Enter an answer correct to 2 decimal places.

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Q: 14

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Effective Interest Rate

The term interest rate can be defined as the amount that is charged by the lender as a percentage on the principal amount. Interest rate which is charged annually is known as annual percentage rate.