Your Need to Repay a Loan with a Future Value

question 49

Multiple Choice

Your need to repay a loan with a future value of $304,071.00 in 18.5 years.If you can make annual year-end deposits of $11,000 into an account,what annual rate of return would you require to earn enough money to pay the loan in full at the due date?

• A)7.92%
• B)8.73%
• C)4.16%
• D)4.39%

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Definitions:

Perfect Competitor

A theoretical market structure where many buyers and sellers exchange identical products, and no single entity can influence the market price.

Long Run

A period in economics during which all factors of production and costs are variable, allowing for the full adjustment to changes.

Long Run

A period of time in economics during which all factors of production and costs are variable, allowing for full adjustment to changes.

Making a Loss

Making a loss occurs when a business's total expenses exceed its total revenues during a specific period, indicating that the business is not financially profitable.