A Bank Has Agreed to Loan You $10,000 at 11

question 101

Multiple Choice

A bank has agreed to loan you $10,000 at 11% for 5 years. You are required to make equal, annual, end-of-year payments that include both principal and interest on the outstanding balance. Determine the amount of these annual payments (to the nearest dollar) .

• A) $2,000
• B) $3,100
• C) $2,706
• D) $1,100

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Definitions:

Guerrilla Tactics

Guerrilla tactics are unconventional warfare strategies used by a smaller force to combat a larger, more conventionally organized military, often including surprise attacks, sabotage, and use of the terrain to harass and undermine the enemy.

American Mainland

Refers to the continental part of the United States excluding Alaska, Hawaii, and other offshore territories.

Dutch Loans

Financial loans provided by the Dutch to other countries or entities in the past, significant in early American history for helping to finance the American Revolutionary War.