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jasenka [17]
3 years ago
13

Calculate the rent of a decreasing annuity at 8% interest compounded quarterly with payments made every quarter-year for 7 years

and present value $78,000.
Mathematics
1 answer:
Papessa [141]3 years ago
5 0
The general Formula for a decreasing Annuity is:
P = ( \frac{(1+i)^n -1}{i (1+i)^n}) R
For this example we have:
P = 78,000
n = 7*4 = 28
i = 8%/4 = 2% = 0.02

After substituting you can find value for R, rent.
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