Title: On the Values of Annuities, which are to pay Certain given Rates of Interest on the Purchase Money During the Whole Term of Their Continuance, and to replace their Original Values, on their Expiration, at Certain other given Rates
Abstract: Notwithstanding the very large amount of leasehold property, which in the course of every year is bought and sold in this country, and notwithstanding the extensive transactions—of almost hourly occurrence—in the public market, in Government and other temporary Annuities, the subject of the rate of interest which any given purchase will yield the buyer is very imperfectly understood, even by those most deeply interested in the inquiry, unless they happen to be at the same time well versed in actuarial computations. It is not unfrequently imagined by a buyer, that if he purchase a leasehold property or a temporary Annuity at a price corresponding with the value of an Annuity at a given rate of interest, (say 5 per cent.,) that he has made a purchase which will pay him 5 per cent., or which, in other words, will enable him to spend 5 per cent, per annum on his outlay, and at the same time replace his capital undiminished at the expiration of the term.