On August 1, a $30,000, 6%, 3-Year Installment Note Payable

question 170

Multiple Choice

On August 1, a $30,000, 6%, 3-year installment note payable is issued by a company. The note requires equal payments of principal plus accrued interest be paid each year on July 31. The present value of an annuity factor for 3 years at 6% is 2.6730. The present value of a single sum factor for 3 years at 6% is 0.8396. The payment each July 31 will be:

• A) $80,190,00.
• B) $10,000.00.
• C) $10,400.00.
• D) $11,223.34.
• E) $1,223.34.

---

Definitions:

Subgoal Activation

The process by which smaller objectives are targeted in order to achieve larger, overarching goals.

Functional Fixedness

The cognitive bias that limits a person to using an object only in the way it is traditionally used.

Stepwise Incrimination

A gradual increase in criminal behavior or severity of crimes committed, often observed in serial offenders.

Hill Climbing

A problem-solving strategy that involves continuous moves towards increasing improvement or higher value.