Find the Present Value of a Loan with an Annual

question 227

Multiple Choice

Find the present value of a loan with an annual interest rate of 6.5% and periodic payments of $1270.74 for a term of 27 years, with payments made and interest charged 12 times per year.

• A) $387,683.73
• B) $155,073.49
• C) $348,915.36
• D) $193,841.87

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Definitions:

Self-Employed Health Insurance

A tax deduction available to self-employed individuals for premiums paid on medical, dental, and long-term care insurance for themselves and their dependents.

Above-The-Line

refers to deductions that taxpayers are allowed to subtract from gross income to arrive at the adjusted gross income, which are beneficial as they are not subject to itemized deductions limitations.

Child Support Payment

Payments made by a non-custodial parent to support their child or children's living expenses.

Alimony Payment

Payments made to a spouse or former spouse under a separation or divorce agreement, which can be deductible for the payer and reportable as income for the recipient, under certain conditions.