Presentation on theme: "Warm up You took out a loan for $1460 and the bank gave you a 5 year add on loan at an interest rate of 10.4%. How much interest will you pay and how much."— Presentation transcript:
Warm up You took out a loan for $1460 and the bank gave you a 5 year add on loan at an interest rate of 10.4%. How much interest will you pay and how much will your monthly payments be? Using the unpaid balance method find the finance charge, and next months balance. Last months balance is $475 at an interest rate of 21%. You bought a jacket for $180, returned a camera for $145 and made a payment of $225.
What is an annuity? An annuity is a contract between you and an insurance company that is designed to meet retirement and other long-range goals, under which you make a lump-sum payment or series of payments. In return, the insurer agrees to make periodic payments to you beginning immediately or at some future date.
Here’s a little more on annuities…. https://www.fidelity.com/annuities/FPRA- variable-annuity/video gs
You will create a table like the one in the example showing an annuity with a monthly deposit of $250 at the end of each month, compounded monthly at 14.5%. For the rate, use accuracy to 3 decimal places.