A Payment of $25,000 Is Due on January 1,2014

question 17

Multiple Choice

A payment of $25,000 is due on January 1,2014.To accumulate enough money to make this required payment,monthly deposits of $R were made into an account earning j12 = 6% starting on June 1,2012.If the last deposit is made on January 1,2014,what is R?

• A)$1257.56
• B)$1191.66
• C)$1251.30
• D)$1185.73

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Definitions:

Japanese Yen

The official currency of Japan, represented by the symbol ¥.

Subject to

Conditioned upon or dependent on a certain event or provision, often indicating the existence of specific limitations or requirements.

Negotiable Instruments

Financial instruments that guarantee the payment of a specified amount of money, either on demand or at a set time, with the feature of being transferable from one party to another.

Certificates of Deposit

A financial product typically offered by banks that provides an interest rate premium in exchange for the customer agreeing to leave a lump-sum deposit untouched for a predetermined period.