The interest factor (IF) for the future value of an ordinary annuity is 4.641 at 10% for four years. If we wish to accumulate $8,000 by the end of four years, how much should the annual payments be?
A) $2,500
B) $2,000
C) $1,724
D) $37,128

Question

Quizplus · Accepted Answer

To find the annual payment required to accumulate $8,000 by the end of four years with an interest factor (IF) of 4.641 for an ordinary annuity at 10%, you divide the future value by the interest factor: $8,000 / 4.641 = approximately $1,724.

The Interest Factor (IF) for the Future Value of an Ordinary