Suppose you plan to work right after you graduate, but still save money for graduate school. You decide to save $35,000 before starting, and find a weekly annuity that pays 6% interest for 4 years. How much will you need to pay each week?
A) $148.98
B) $186.23
C) $134.08
D) $163.88

Question

Quizplus · Accepted Answer

To find the weekly payment for an annuity, we use the formula for the future value of an annuity. Given the future value ($35,000), interest rate (6% annually, or approximately 0.1154% weekly), and the number of periods (4 years * 52 weeks = 208 weeks), we solve for the weekly payment. The correct calculation results in approximately $148.98.

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