Asked by Stephanie Schiwietz on May 13, 2024
Verified
Harold and Patricia Abernathy made a loan to their son, Jason. To repay the loan, Jason will make payments of $2,000 at the end of each of the next 10 years. If the interest rate on the loan is 7% compounded annually, what was the amount of the original loan? (Taken from CIFP course materials.)
Compounded Annually
Interest on an investment that is calculated once a year and added to the principal sum of the investment.
- Familiarize yourself with the calculation and application of present value in multiple financial environments.
- Utilize economic calculations to address complicated matters associated with annuities, debts, and investments.
Verified Answer
NC
Learning Objectives
- Familiarize yourself with the calculation and application of present value in multiple financial environments.
- Utilize economic calculations to address complicated matters associated with annuities, debts, and investments.