What amount can you borrow if you make six quarterly payments of $4,000 at a 12 % annual rate of interest?
A)$24,838.00
B)$21,668.80
C)$31,049.00
D)$40,000.00
E)$44,800.00

Question

Quizplus · Accepted Answer

Present Value of an Annuity = Annuity * Interest Factor
Present Value of an Annuity = $4,000 * 5.4172 = $21,668.80
5.4172 is the interest factor on the Present Value of an Annuity table; n = 6; i = 12/4= 3%

What Amount Can You Borrow If You Make Six Quarterly