Christine Parks received a trust fund inheritance of $15,000 on her 20th birthday. She plans to use the money to supplement her income with 28 quarterly payments beginning on her 50th birthday. If the money is worth an annual rate of 7.2% compounded quarterly, how much will each quarterly payment be? Round your answer to the nearest cent.
A)$7,107.79
B)$5,738.01
C)$9,124.39
D)$10,155.25
E)$2,437.07

Question

Christine Parks received a trust fund inheritance of $15,000 on her 20th birthday. She plans to use the money to supplement her income with 28 quarterly payments beginning on her 50th birthday. If the money is worth an annual rate of 7.2% compounded quarterly, how much will each quarterly payment be? Round your answer to the nearest cent. ​
A)$7,107.79
B)$5,738.01
C)$9,124.39
D)$10,155.25
E)$2,437.07

Quizplus · Accepted Answer

The future value of the inheritance is calculated using the formula for compound interest, and then the annuity formula is used to find the quarterly payment amount.

Christine Parks Received a Trust Fund Inheritance of $15,000 on Her