Jane bought a $3,000 audio system and agreed to pay for the purchase in 10 equal annual installments beginning one year from today. The interest rate is 12%. What is the amount of the annual installment?

Jane

The amount of the annual installment is:

$530.98

Explanation:

Present value of audio system = $3,000

Interest rate (r) = 12%

Number of years for installments (n) = 10 years

The future value = PV * (1 + r)∧n

= $3,000 * (1 + 0.12)∧10

= Future value of the audio system

= $9,318 ($3,000 * 3.106)

Jane will need to contribute $530.98 at the end of each period to reach the future value of $9,318.00.

From online financial calculator:

FV (Future Value)$9,318.00

PV (Present Value)$3,000.15

N (Number of Periods)10.000

I/Y (Interest Rate)12.000%

PMT (Periodic Payment)$530.98

Starting Investment$0.00

Total Principal$5,309.78

Total Interest$4,008.22

x=3

step-by-step explanation:

this is really simple i saw that there was only one term (5x) and thought if that was 15 what would i have to multiply everything else to get it there? well if 5x became 15 then x would have to be 3 so plug the 3 in the x for the other equations and you get 15 for the other ones. so there you go. : )

i'ts proportional. if the inflation rate is 12% for example, the cpi will be 12% less.

hope it ,

bioteacher101