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One would need to determine the future value of an annuity to determine how much long and how much interest will be paid by paying only the monthly payment as oppose to increasing the amount slightly each payment. The result will show that making a slightly higher payment will allow the borrower to pay off the debt sooner and by paying less interest overall...
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An individual can determine how much life insurance will be needed by using the present value equation because that will determine what money payable in the future is worth today at a given rate of interest. The formula used to compare costs of life insurance is known as the interest-adjusted cost index which “converts the time value into a dollar figure...
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