Question

Solve the following problem. PV=$24,122; n = 70; i = 0.024; PMT ?; PMT = $ (Round to two decimal places.)

Answer 1

The payment per period is $714.82.

Explanation:

Given information: PV=$24,122; n = 70; i = 0.024

The formula for payment per period is

`PMT=(PV* i)/(1-(1+i)^(-n))`

Substitute PV=$24,122; n = 70; i = 0.024 in the above formula.

`PMT=(24122* 0.024)/(1-(1+0.024)^(-70))`

`PMT=(578.928)/(0.80989084337)`

`PMT=714.822256282`

`PMT\approx 714.82`

Therefore the payment per period is $714.82.