What Is the Interest Rate of a 6-Year, Annual $3,000

question 133

Multiple Choice

What is the interest rate of a 6-year, annual $3,000 annuity with present value of $14,000?

• A) 5.64 percent
• B) 7.69 percent
• C) 10.17 percent
• D) 11.32 percent

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Definitions:

Business Days

Refers to the standard days in a week (excluding weekends and public holidays) considered as working days for conducting business.

Deposit

A sum of money placed in an account or given as security for a financial transaction or agreement.

Checking Account

A bank account that allows the holder to write checks, use electronic debit, and make deposits, meant for frequent transactions.

Improperly Dishonors

Refers to the situation where a financial institution wrongfully refuses to accept a valid check or draft presented for payment.