Suppose You Take Out a $10,000 Loan at a 6

question 98

Multiple Choice

Suppose you take out a $10,000 loan at a 6% nominal annual rate.The terms of the loan require you to make 12 equal end-of-month payments each year for 4 years,and then an additional final (balloon) payment of $4,000 at the end of the last month.What will your equal monthly payments be?

• A)$137.96
• B)$145.22
• C)$152.86
• D)$160.91

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Definitions:

Pituitary Gland

A small, pea-sized gland located at the base of the brain that produces hormones influencing growth, metabolism, and the functioning of other endocrine glands.

Endocrine System

A bodily system comprising of glands that release hormones directly into the bloodstream to regulate body functions and maintain homeostasis.

Hormones

Chemical messengers produced by glands in the body, which travel through the bloodstream to tissues or organs to regulate bodily functions.

Bloodstream

The flowing blood within the circulatory system of the body, responsible for transporting oxygen, nutrients, waste, and other substances.