Question:
Value of a retirement annuity: An insurance agents is trying to sell you an immediate-retirement annuity,which for a single amount paid today will provide you with $12,000 at the end of each year for the next 25 years. You currently earn 9% on low-risk investment comparable to the retirement annuity. Ignoring taxes,what is the most you would pay for this annuity?

My Answer:
I=interest, n=year
A=FVAn/FVIFAi,n
=$12,000/(FVIFA9%,25)
=$12,000/84.699
=$141.68

Is it correct?
Please help me!

No, sorry. The problem is asking for the present value of an annuity. You need to make two adjustments...

(1) Use the table for present value, not future value, of an annuity;

(2) You'll multiply, not divide, the annual payment amount by the table factor.

Give that a try and see what you get.