If you buy a factory for $250,000 and the terms are 20 percent down, the balance to be paid off over 30 years at a 12 percent ra

Question

3 years ago

11

te of interest on the unpaid balance, what are the 30 equal annual payments?
a. $20,593
b. $31,036
c. $24,829
d. $50,212
e. $ 6,667

1 answer:

brilliants [131] · Answer 1 · 2022-04-19T06:23:19+03:00

Answer:

c. $24,829

Explanation:

We use the PMT formula that is shown in the spreadsheet below:

Provided that,

Present value = $250,000 - $250,000 × 20% = $200,000

Future value = $0

Rate of interest = 12%

NPER = 30 years

The formula is shown below:

= PMT(Rate;NPER;-PV;FV;type)

The present value come in negative

So, after solving this, the answer would be $24,828.73