George makes annual end-of-year payments of $5,043.71 on a four-year loan with an interest rate of 13 percent. The original principal amount was
A) $24,462
B) $15,000
C) $17,000
D) $20,175

Question

Quizplus · Accepted Answer

The original principal amount can be calculated using the formula for the present value of an annuity. Using the given annual payment, interest rate, and loan term, the calculation shows that the original principal amount is approximately $15,000.

George Makes Annual End-Of-Year Payments of $5,043