# A 10-year annuity providing a rate of return of 5.6% compounded quarterly was purchased for $25,000. The

## Question:

a. How much of the twenty-fifth payment is interest?

b. What is the principal portion of the thirteenth payment?

c. What is the total interest in Payments 11 to 20 inclusive?

d. How much is the principal reduction in the second year?

e. What is the final payment?

Annuity

An annuity is a series of equal payment made at equal intervals during a period of time. In other words annuity is a contract between insurer and insurance company in which insurer make a lump-sum payment or a series of payment and, in return,...

Fantastic news! We've Found the answer you've been seeking!

## Step by Step Answer:

**Related Book For**