Ask Question
19 March, 05:18

Damien McCoy has loaned money to his brother at an interest rate of 5.85 percent. He expects to receive $987, $1,012, $1,062, and $1,162 at the end of the next four years as complete repayment of the loan with interest. How much did he loan out to his brother? (Round to the nearest dollar.)

+4
Answers (1)
  1. 19 March, 05:50
    0
    The answer is: $3,657

    Explanation:

    To determine the amount of the loan we have to calculate the present value of the future payments discounting the interest rate of 5.85%.

    PV loan = $987 + $1,012 + $1,062 + $1,162

    1.0585 1.0585^2 1.0585^3 1.0585^4

    PV loan = $932.45 + 903.23 + 895.47 + 925.64

    PV loan = $3,656.80
Know the Answer?
Not Sure About the Answer?
Get an answer to your question ✅ “Damien McCoy has loaned money to his brother at an interest rate of 5.85 percent. He expects to receive $987, $1,012, $1,062, and $1,162 at ...” in 📙 Business if there is no answer or all answers are wrong, use a search bar and try to find the answer among similar questions.
Search for Other Answers