Question

TriStar Company, a small biotechnology firm, has borrowed $250,000 to purchase laboratory equipment for gene splicing. The loan carries an interest rate of 8% per year and is to be repaid in equal installments over the next 6 years. What is the amount of the annual installment

Answer 1

Answer:

$54,078.85

Explanation:

This is a Time Value of Money question, We are required to find the Payment (Pmt) from the following given parameters :

Pv = $250,000

i = 8%

n = 6

P/yr = 1

Fv = $ 0

Pmt = ?

Pmt = $54,078.85

Therefore Payment per year is $54,078.85 (using a financial calculator)