Question

would you like please provide me typing writing not hand writiing?

Ryan Borrowed $15,000 now with a 7% interest rate compounded annually. He needs to pay them back over 7 years starting from the end of the first year, what will be Ryan’s annuity assuming that he will miss the 4th payment

Answer 1

Answer is Annuity of $3242.33

The explanation is as follows:

The cimulative Present value factor for 7 years @7% is 5.3892

Less: Present value factor of 4th payment:                    0.7629

Cumulative Present value factor for 7 years except 4th year: 4.6263

Now, amount of borrowing: $ 15,000

Annuity amount that will be paid each year except 4th year ($15000 /4.6263) = $3242.33