Columbia Bank & Trust Has Just Given You a $20,000

question 18

Multiple Choice

Columbia Bank & Trust has just given you a $20,000 term loan to pay for a new concrete mixer.The loan requires five equal annual end of the year payments.If the loan provides the bank with a 12 percent return, what will be your annual payments?

• A)$5,548
• B)$3,148.12
• C)$6,000
• D)$1,666.67

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Definitions:

Personally Liable

The state of being legally responsible for one's actions on an individual basis, which can result in personal financial liability.

Partnership

A form of business conduct legally established among at least two partners with shared responsibilities and profit distribution.

Debts

Money owed by one party to another under an agreement that the amount will be paid back, often with interest, by a certain date.

Limited Partnership

A partnership consisting of one or more general partners and one or more limited partners.