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16 April, 14:36

True or False. The periodic (for example, monthly, quarterly, or annual) payment for an amortized loan is determined as the payment term in the formula for the calculation of the present value of an annuity. False

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  1. 16 April, 18:24
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    Answer: The correct answer is "false".

    Explanation: The payment term in the formula for the calculation of the present value of an annuity consists of 3 variables.

    Term of the operation: The term of the operation is the duration in the time that the operation has, from the constitution of the annuity until its expiration.

    Periodic payment: The periodic payment is how often the annuity pays interest. (For example: monthly, quarterly or annual).

    and "N": It is the number of times that the periodic payment enters within the term of the operation. For example, if the term of the operation is 1 year, and the periodic payment monthly, N = 12. If the term is 1 year and the periodic payment is quarterly, N = 4.

    This number "n" is the one used in the formula for calculating the present value of an annuity.
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