Given the Time-Value of Money of 11% Compounded Annually, Calculate

question 109

Multiple Choice

Given the time-value of money of 11% compounded annually, calculate the size of the month-end payments for the next five years that would be equivalent to a single payment of $13,285 payable five years from now.

• A) $285.42
• B) $221.42
• C) $169.39
• D) $177.76
• E) $299.54

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Definitions:

Social Security Act

A U.S. law enacted in 1935 that created a system of transfer payments in which younger, working people support older, retired people.

Welfare

A system of government support for citizens in need, often including financial assistance, healthcare, and housing programs.

Welfare System

A government program designed to provide financial and other assistance to individuals and families in need.

Self-sufficiency

The ability of an individual, community, or nation to provide for its own needs without relying on external assistance.