Find the payment made by the ordinary annuity with the given present value.
$79,925, monthly payments for 27 years, interest rate is 4.1%, compounded monthly

To find the payment made by an ordinary annuity, we can use the present value of an ordinary annuity formula:

\[
PV = P \times \left( \frac{1 - (1 + r)^{-nt}}{r} \right)
\]

Where:
- $ PV $ is the present value of the annuity.
- $ P $ is the regular payment.
- $ r $ is the monthly interest rate.
- $ n $ is the number of payments per year.
- $ t $ is the number of years.

### Given:
- $ PV = 79,925 $
- $ r = \frac{4.1\%}{12} = \frac{0.041}{12} $
- $ t = 27 $ years
- $ n = 12 $ (monthly payments)

Now we solve for $ P $ (the monthly payment). Let's substitute the values and compute the result.The monthly payment for the ordinary annuity is approximately **$408.29**.

Do you need any further details or have any questions?

Here are 5 related questions you might find interesting:
1. How does the present value of an annuity change if the interest rate increases?
2. What is the difference between an ordinary annuity and an annuity due?
3. How would the payment change if the annuity period is shortened to 20 years?
4. How does compounding frequency affect annuity payments?
5. Can you calculate the future value of this annuity after 27 years?

**Tip:** In an ordinary annuity, payments are made at the end of each period, while in an annuity due, they are made at the beginning.

Find the payment made by the ordinary annuity with the given present value. $79,925, monthly payments for 27 years, interest rate is 4.1%, compounded monthly.

Learn how to calculate the monthly payment for an ordinary annuity given a present value of $79,925, a 4.1% interest rate compounded monthly, and a duration of 27 years. This detailed explanation uses the Present Value of an Ordinary Annuity formula to solve the problem.

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