Columbia Bank & Trust Has Just Given You a $20,000

Multiple Choice

Columbia Bank & Trust has just given you a $20,000 term loan to pay for a new concrete mixer. The loan requires five equal annual end-of-the-year payments. If the loan provides the bank with a 12 percent return, what will be your annual payments?

A) $5,547.85
B) $3,148.12
C) $6,000
D) $1,666.67