1. ANC Company is considering the purchase of an equipment. The purchase consists of quarterly payments of $37,200 for four years at 7.6 percent interest. What is the present value of this purchase?

A. $509,114.89

B. $587,418.22

C. $514,184.40 2. Today, your grandfather is buying a 10-year, 4.8 percent annuity at a cost of $50,000. The annuity will pay annual payments starting one year from today. What is the amount of each payment?

A. $13,619.19

B. $6,412.49

C. $6,874.70

3. Kobe pays 1% per month in interest on his credit card debt. When his monthly rate is multiplied by 12, the resulting answer is called the:

A. compounded rate.

B. annual percentage rate.

C. effective annual rate.