contestada

Shaan and Anita currently insure their cars with separate companies, paying $850 and $675 a year. If they insure both cars with the same company, they would save 10 percent on their annual premiums. What would be the future value of the annual savings over 8 years based on an annual interest rate of 8 percent

Respuesta :

Parrain

Answer: $1,622.08

Explanation:

Currently both Shaan and Anita are cumulatively paying;

= 850 + 675

= $1,525

Their savings are;

= 1,525 * 10%

= $152.50

As this saving is fixed, it is an annuity. The future value over 8 years at 8% is;

Future Value of Annuity = Annuity * Future value annuity factor, 8 years, 8%

= 152.50 * 10.6366

= 1,622.0815‬

= $1,622.08

Ver imagen Parrain

Otras preguntas