The Interest Factor (IF) for the Future Value of an Ordinary

question 83

Multiple Choice

The interest factor (IF) for the future value of an ordinary annuity is 4.641 at 10% for four years. If we wish to accumulate $8,000 by the end of four years, how much should the annual payments be?

• A)$2,500
• B)$2,000
• C)$1,724
• D)None of these options

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Definitions:

Credit Cards

Financial instruments that allow users to borrow funds up to a pre-set limit for purchases or cash advances, with the expectation of paying back the borrowed amount over time.

M1

A category of the money supply that includes all physical money like coins and currency, as well as demand deposits and other liquid assets that can quickly be converted to cash.

Money Demand Curve

An illustrative chart demonstrating the link between the amount of money desired by people to keep and the interest rate.

Alternative Policy Options

Different strategies or approaches that policymakers can use to address specific economic, social, or political issues.