Wanda Green wants to take out a 4 year loan to purchase a car.What type of computation would she use to calculate her monthly payments?

Question

Quizplus · Accepted Answer

Wanda Green would use the Present Value of an Annuity (PVA) computation to calculate her monthly payments for a 4-year loan. PVA is used to determine the present value of a series of payments that are made at regular intervals for a specified amount of time. In this case, Wanda would use PVA to calculate the amount she would need to borrow to cover the cost of the car and make monthly payments over the 4-year loan term.

Wanda Green Wants to Take Out a 4 Year Loan