Question

Lee associates borrowed $60,000. The company plans to set up a sinking fund that will pay back the loan at the end of 12 years. Assuming a rate of 8% compounded semiannually, the amount to be paid into the fund each period is?

Answer 1

If your choices are the following:
A. $1,350
B. $1,536
C. $1,653
D. $5,163
E. None of these

Then the answer is B. $1,536.

Solution:
$60,000 x .0256
=1,536