An annuity offers a payment of $5000 at the beginning of every three months for twenty years. Interest is compounded monthly at a nominal rate of 8.8%, and the first payment is deferred for 3 years. Determine the amount that you would pay for this annuity today.

An annuity offers a payment of $5000 at the beginning of every three months for twenty years. Interest is compounded monthly at a nominal rate of 8.8%, and the first payment is deferred for 3 years. Determine the amount that you would pay for this annuity today.

Pfin (with Mindtap, 1 Term Printed Access Card) (mindtap Course List)

7th Edition

ISBN:9780357033609

Author:Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk

Publisher:Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk

Chapter7: Using Consumer Loans

Section: Chapter Questions

Problem 6FPE

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Question

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An annuity offers a payment of $5000 at the beginning of every three months for
twenty years. Interest is compounded monthly at a nominal rate of 8.8%, and the
first payment is deferred for 3 years. Determine the amount that you would pay for
this annuity today.
O a. $ 145 573.01
O b. $ 146 563.01
O c. $ 146 939.01
O d. $ 146 585.01
O e. $ 143 982.01

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