Suppose Payments Were Made at the End of Each Month

question 21

Multiple Choice

Suppose payments were made at the end of each month into an ordinary annuity earning interest at the rate of 10%/year compounded monthly. If the future value of the annuity after 10 years is $70,000, what was the size of each payment? Round your answer to the nearest cent. ​

• A) R = $379.20
• B) R = $341.72
• C) R = $284.37
• D) R = $365.25

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Definitions:

Total Profit

The overall financial gain made by a business after subtracting all expenses from the total revenue.

Profit-maximizing Price

The price level at which a company can sell its product to achieve the maximum possible profit, taking into account demand and production costs.

Professional Organizations

Associations or groups that represent the interests of individuals within a specific profession, offering resources, networking opportunities, and professional development.

Producer Groups

Organizations or associations of producers that collaborate to protect their interests, often through lobbying, marketing, and sharing resources to improve their market position.