A year-end bonus of $15,000 will generate how much money at the beginning of each month for the next year, if it can be invested at 6.48%, compounded monthly? Round your answer to the nearest cent.
A)$1,536.61
B)$1,287.36
C)$7,520.20
D)$2,533.78
E)$664.47

Question

A year-end bonus of $15,000 will generate how much money at the beginning of each month for the next year, if it can be invested at 6.48%, compounded monthly? Round your answer to the nearest cent. ​
A)$1,536.61
B)$1,287.36
C)$7,520.20
D)$2,533.78
E)$664.47

Quizplus · Accepted Answer

To find the monthly payment, we use the formula for the annuity payment: PMT = P * (r(1+r)^n) / ((1+r)^n - 1), where P is the principal ($15,000), r is the monthly interest rate (6.48% annually or 0.54% monthly), and n is the number of payments (12). Solving this gives approximately $1,287.36.

A Year-End Bonus of $15,000 Will Generate How Much Money