Respuesta :
Answer:
The correct option is c.
Step-by-step explanation:
Given information: monthly payments = $250.00, Interest rate = 2.3% compounded monthly over a 5 year period.
The formula for monthly payment:
[tex]C=\frac{PV(\frac{r}{n})}{1-(1+\frac{r}{n})^{-n*t}}[/tex]
Where, C is monthly payment, r is rate of interest, n is number of times interest compounded in a year, t is number of years, PV is present value.
[tex]250=\frac{PV(\frac{0.023}{12})}{1-(1+\frac{0.023}{12})^{-12*5}}[/tex]
[tex]250=\frac{PV(\frac{0.023}{12})}{1-(1+\frac{0.023}{12})^{-60}}[/tex]
[tex]250(1-(1+\frac{0.023}{12})^{-60})=PV(\frac{0.023}{12})[/tex]
[tex]\frac{250(1-(1+\frac{0.023}{12})^{-60})}{(\frac{0.023}{12})}=PV[/tex]
[tex]14156.83566=PV[/tex]
[tex]14156.84\approx PV[/tex]
The present value is 14156.84.
Therefore the correct option is c.
