You are considering borrowing $200,000 for 20 years at an annual interest rate of 8%. The loan agreement calls for 20 equal annual payments, to be made at the end of each year. What is the payment amount?

Period. // PV of 1. //. . PV of Ordinary Annuity. //. PV of Annuity due

20. ///0.2145 //. 9.8181 // 10.6036

Period. //. FV of 1 //. FV of Ordinary Annuity. //. FV of Annuity due

20. // 4.6610 //. 45.7620 //. 42.4463

• A. $18,861.52
• B. $4,711.84
• C. $20,370.54
• D. $4,370.44

James has asked you to assist him in determining how much he could afford to pay for a vehicle. He has found a BMI 328i that costs $43,000. The local bank will provide financing for 60 months at 8% interest. The bank has stated the first payment will be due 1 month from today. James plans to make a 10% down payment on the vehicle. What is the monthly payment amount?

Periods. //. PV of 1 PV of Ordinary Annuity. PV of Annuity due

60. 0.6712 49.3184 49.6472

Periods. //. FV of 1. //. FV of Ordinary Annuity. // FV of Annuity due

60 //1.4898 // 73.4769 //. 72.9969

• A. $784.70
• B. $526.70
• C. $530.16
• D. $779.50