A manufacturing company is considering taking out a loan to expand its production line. To finance this expansion, the company plans to make equal annual payments over the term of the loan. The terms of the loan are as follows:

The company will make an annual payment of $$45000.$

The loan term is $12$ years.

The annual interest rate offered by the bank is $7\%.$

Calculate the present worth $($P$)$ of the loan. This will help the company understand the total amount of money it needs today to make these annual payments for the duration of the loan term.

Answer rating: 100% (QA)

To calculate the present worth P of the loan which represents the total amount of ... View the full answer