A. A firm borrows $20,000 from the bank at 6 percent compounded annually to purchase some new machinery. This loan is to be repaid in equal annual installments at the end of each year over the next 15 years. How much will each annual payment be?

B. Determine the present value of an annuity due of $1,000 per year for 25 years discounted back to the present at an annual rate of 7 percent. What would be the present value of this annuity due if it were discounted at an annual rate of 12 percent?