Yahoo Answers is shutting down on May 4th, 2021 (Eastern Time) and beginning April 20th, 2021 (Eastern Time) the Yahoo Answers website will be in read-only mode. There will be no changes to other Yahoo properties or services, or your Yahoo account. You can find more information about the Yahoo Answers shutdown and how to download your data on this help page.
Trending News
Finance Annuity Due Payment?
I cannot figure out this problem for my finance class please help.
You want to buy a new sports car from Muscle Motors for $74,000. The contract is in the form of a 72-month annuity due at a 7.05 percent APR. What will your monthly payment be? (Do not round intermediate calculations and round your final answer to 2 decimal places. (e.g., 32.16))
3 Answers
- Don GLv 78 years agoFavorite Answer
The formula for the PV of an Annuity Due is (1 - (1 / (1 + r) ^n) / r ) x (1 + r).
Here PV is known, it's 74,000. R = 7.05% / 12, or .5875%, and N = 72.
So 74,000 = (1 - (1 / 1.005875^72) / .005875) x 1.005875, and
74,000 = (1 - (1 / 1.524646) / .005875) = (1 - .65589) / .005875 = .34411 / .005875 = 58.571915 x 1.005875 = 58.916025 (factor).
So 74,000 = Annuity Due x 58.916025, and Annuity Due = 74,000 / 58.916025, or 1,256.03
Of course, using a financial calculator, with payments set at BGN, is much easier.
- ?Lv 44 years ago
sturdy day i'm surprising here for the 1st time. I stumbled in this question and that i come across the replies extremely useful. i prefer to furnish something decrease back to the community and help others too.
- 5 years ago
It takes 7 seconds for the yahoo answers page to load for me to be able to click on the [add your answer] button. thus, is my laptop slow?
