7. A 10 year loan of 2,000 is repaid with payments the end of each year.There are 2 options:a. Equal annual payments at an annual effective rate of 8.07%;b. Installment of 200 each year plus interest on the outstanding balanceat an effective rate of i %.The sum of the payments under each option is the same. What is i?

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Answered: A 10 year loan of 2,000 is repaid with…

Advanced Engineering Mathematics

10th Edition

ISBN:9780470458365

Author:Erwin Kreyszig

Publisher:Erwin Kreyszig

Chapter2: Second-order Linear Odes

Section: Chapter Questions

Problem 1RQ

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A loan of $26,000 is paid off in 36 payments at the end of each month in the following way: Payments of $650 are made at the end of the month for the first 12 months. Payments of $650 + x are made at the end of the month for the second 12 months. Payments of $650 + 2x are made at the end of the month for the last 12 months. What should x be if the nominal monthly rate is 12.2%?
10
Krista borrowed $15,380. The loan is to be repaid by three equal payments due in 98, 146, and 272 days from now respectively. Determine the size of the equal payments at an interest rate of 10% with a focal date of today
You will be in graduate school for the next two years. You borrowed some money from the bank for your graduate education, which the bank has accepted to be paid after you graduate from school in three years. The bank has accepted to the following payment plan; from the beginning of Year 3 (25th month) to end of year 5 (60th month), pay $950 per month 25 and increase payment by 2% every month thereafter. How much money should you put aside each month (equal amount) for the first 24 months (during graduate school) such that you can pay the loan back after graduation? Use an APR of 12%, compounded monthly. Question 7 Part A.
Consider a student loan of $12,500 at a fixed APR of 12% for 20 years. a. Calculate the monthly payment. b. Determine the total amount paid over the term of the loan. c. Of the total amount paid, what percentage is paid toward the principal and what percentage is paid for interest.
You have just borrowed 130,000, and you agree to pay it back over the next 30 years in 30 equal end-of-year payments plus 8 percent compound interest on the unpaid balance. What will be the size of these payments?
The monthly payments on a 10-year loan of $35,000 at 6.1% interest are $390.33. (a) What is the total amount paid over the 10 years?$ (b) What is the total amount of interest paid?

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