Compute the size of the first payment of a car loan. More specifically, you’ll borrow $18,879 today at an APR of 6%. There will be a total of 47 equally-sized (g = 0), monthly payments with the first payment due immediately.
B) Compute the future value, F, which coincides with the last payment of a finite annuity stream. The first payment occurs in 5 years, and the last payment occurs 14 years from today. The first payment will be $157. Subsequent payments will grow at an annual rate of 3.8%. Use an effective annual rate (EAR) of 10.5%.
C) Compute the future value which coincides with the last payment of a finite annuity stream. The first payment occurs in four years, and the last payment occurs nine years from today. The first payment will be $135. Subsequent payments will grow at an annual rate of 5.0%. Use an effective annual rate (EAR) of 11.0%.
