Question:
Kingsley Toyota borrowed $100,000 from a local bank. The loan requires Kingsley to pay 10 equal
annual installments beginning one year from today. Assuming an interest rate of 8%, what is the amount
of each annual installment payment?
Answer:
Annuity = $100,000 = $14,903 = Payment
6.71008
Present value of an ordinary annuity of $1: n = 10, i = 8% (from Table 4)
Kingsley Toyota borrowed $100,000 from a local bank. The loan requires Kingsley to pay 10 equal
annual installments beginning one year from today. Assuming an interest rate of 8%, what is the amount
of each annual installment payment?
Answer:
Annuity = $100,000 = $14,903 = Payment
6.71008
Present value of an ordinary annuity of $1: n = 10, i = 8% (from Table 4)
