Quarterly Payment = $10,000
Time Period = 15 years
Interest Rate = 9%
a.
Calculating Future Value,
Using TVM Calculation,
FV = [PV = 0, T = 60, PMT = 10,000, I = 0.09/4]
Future Value = $1,244,504.35
b.
Converting Monthly Rate to Quarterly Rate,
EAR = (1 + 0.09/12)12 - 1 = 9.38%
Converting to Quarterly Rate,
APR(Quarterly) = 4((1 + 0.0938)1/4 - 1)
APR(Quarterly) = 9.067%
Calculating Future Value,
Using TVM Calculation,
FV = [PV = 0, T = 60, PMT = 10,000, I = 0.09067/4]
Future Value = $1,251,865.81
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