Final answer:
In the context of the future value of an ordinary annuity, when making monthly payments for 30 years, the value for n is 360. This represents the total number of monthly payments (30 years x 12 months).
Step-by-step explanation:
The question refers to the future value of an ordinary annuity formula, specifically to find the value for n when monthly payments are made for 30 years. In this context, n represents the total number of payments. Since payments are monthly over 30 years, n would indeed be the number of months in 30 years which is 30 years times 12 months per year, resulting in 360 monthly payments. Therefore, the correct answer is a. (360).
For a $300,000 loan at 6% interest rate compounded monthly for 30 years, the monthly payment can be calculated using the annuity formula. If payments are increased by a fraction of 12, implying the equivalent of making 13 payments per year instead of 12, the loan would be paid off quicker and less interest would be incurred over the term, leading to both time and money savings for the borrower.
\