A car buyer takes out a 25,000 e loan to purchase the car. Suppose that the annual interest rate is 3%. Assume that interest is compounded continuously and that payments are also made continuously. (i) What monthly payment is required to pay off the loan in 10 years? (ii) What is the total interest paid during the term of the mortgage?

Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
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 A car buyer takes out a 25,000 e loan to purchase the car. Suppose that the annual interest rate is 3%. Assume that interest is compounded continuously and that payments are also made continuously.
(i) What monthly payment is required to pay off the loan in 10 years?
(ii) What is the total interest paid during the term of the mortgage?

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