Question

Find the monthly payment that will yield the given future value. (Round your answer to the nearest cent.)

$95,000 at
9(1/4)%
interest for thirty-two years; ordinary annuity

Answer 1

The monthly payment that will yield the given future value of $95,000 at 9(1/4)% interest for thirty-two years is approximately $9,452.79.

Step-by-step explanation:

To find the monthly payment that will yield the given future value, we can use the formula for the present value of an ordinary annuity:

Payment = Future Value / Present Value Factor

First, we need to find the Present Value Factor (PVF) using the formula:

PVF = (1 - (1 + interest rate)^(-n)) / interest rate

Substituting the given values, we have:

PVF = (1 - (1 + 0.0925)^(-32)) / 0.0925 = 10.0506

Now we can calculate the monthly payment:

Payment = $95,000 / 10.0506 = $9,452.79 (rounded to the nearest cent)