Explanation Given Information: Payment frequency is 3 months, the time duration is 3 years, the nominal rate of return is 2 % , future value amount is $ 3 , 600 and interest is compounded quarterly. Formula used: The formula for future value of the ordinary annuity is, F V = P m t × ( 1 + i ) n − 1 i Here, FV is the future value, Pmt is the Annuity payment, i is the interest rate per period (nominal rate ÷ periods per year) and n is the number of periods (years × periods per year). Calculation: Consider that payment frequency is 3 months, the time duration is 3 years, the nominal rate of return 2 % , future value amount is $ 3 , 600 and interest is compounded quarterly. The rate period is 0.5 % or 0.005 ( 2 % ÷ 4 period per year ) . The number of periods is 12 ( 3 years × 4 period per year )

Contemporary Mathematics For Business & Consumers, Loose-leaf Version

8th Edition

ISBN: 9781305867185

Author: Robert Brechner, Geroge Bergeman

Publisher: South-Western College Pub

See similar textbooks

Concept explainers

Unitary Method

The word “unitary” comes from the word “unit”, which means a single and complete entity. In this method, we find the value of a unit product from the given number of products, and then we solve for the other number of products.

Speed, Time, and Distance

Imagine you and 3 of your friends are planning to go to the playground at 6 in the evening. Your house is one mile away from the playground and one of your friends named Jim must start at 5 pm to reach the playground by walk. The other two friends are 3 …

Profit and Loss

The amount earned or lost on the sale of one or more items is referred to as the profit or loss on that item.

Units and Measurements

Measurements and comparisons are the foundation of science and engineering. We, therefore, need rules that tell us how things are measured and compared. For these measurements and comparisons, we perform certain experiments, and we will need the experime…

Videos

Question

Chapter 12, Problem 30AT

To determine

To calculate: The amount of sinking fund payment where payment frequency is 3 months, the time duration is 3 years, the nominal rate of return is 2%, future value amount is $3,600 and interest is compounded quarterly.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Chapter 12, Problem 29AT

Chapter 12, Problem 31AT

Students have asked these similar questions

2 Q/ Let d₂ +d, di, d2: R² XR² R² defined as follow ((x+x), (2, 1) = √(x-2)² + (x_wx • d₁ ((x,y), (z, w)) = max {1x-z\, \y-w\} • 1 1 dq ((x,y), (Z, W)) = \ x=2\+\-w| 2 • show that dod₁, d₂ are equivalent? 2

2 +d, di, d2: R² XR² > R² defined as follow Q/ Let d₂ 2/ d((x+x), (2, 1)) = √(x-2)² + (x-wsc • d₁ ((x,y), (z, w)) = max {| x-z\, \y-w\} • d₂ ((x, y), (Z, W)) = 1x-21+ \y-w| 2 • show that ddi, d₂ are equivalent? އ

Numerical an

Chapter 12 Solutions

Contemporary Mathematics For Business & Consumers, Loose-leaf Version

Ch. 12.I - Freeport Bank is paying 8% interest compounded...Ch. 12.I - Vista Savings Loan is paying 6% interest...Ch. 12.I - Katrina Byrd invested $250 at the end of every...Ch. 12.I - Use Table 12-1 to calculate the future value of...Ch. 12.I - Use Table 12-1 to calculate the future value of...Ch. 12.I - Use Table 12-1 to calculate the future value of...Ch. 12.I - Use Table 12-1 to calculate the future value of...Ch. 12.I - Use Table 12-1 to calculate the future value of...Ch. 12.I - Use Table 12-1 to calculate the future value of...Ch. 12.I - Use Table 12-1 to calculate the future value of...

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, subject and related others by exploring similar questions and additional content below.

The amount of sinking fund payment where payment frequency is 3 months, the time duration is 3 years, the nominal rate of return is 2 % , future value amount is $ 3 , 600 and interest is compounded quarterly.

Solution Summary: The author calculates the amount of sinking fund payment, which is 291.87.

Concept explainers

Videos

To calculate: The amount of sinking fund payment where payment frequency is 3 months, the time duration is 3 years, the nominal rate of return is 2%, future value amount is $3,600 and interest is compounded quarterly.

Want to see the full answer?

Chapter 12 Solutions