A debt of $17,500 is repaid by payments of $2850 made at the end of each year. Interest is 8% compounded semi-annually. Complete parts (a) though (d) below. (a) How many payments are needed to repay the debt? The number of payments is 9 (Round up to the nearest whole number.) (b) What is the cost of the debt for the first three years? The cost of the debt for the first three years is $ 3,926.43 (Round to the nearest cent as needed.) (c) What is the principal repaid in the fifth year? The amount of the principal repaid in the fifth year is $ (Round to the nearest cent as needed.)
A debt of $17,500 is repaid by payments of $2850 made at the end of each year. Interest is 8% compounded semi-annually. Complete parts (a) though (d) below. (a) How many payments are needed to repay the debt? The number of payments is 9 (Round up to the nearest whole number.) (b) What is the cost of the debt for the first three years? The cost of the debt for the first three years is $ 3,926.43 (Round to the nearest cent as needed.) (c) What is the principal repaid in the fifth year? The amount of the principal repaid in the fifth year is $ (Round to the nearest cent as needed.)
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
Section: Chapter Questions
Problem 1PS
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Transcribed Image Text:A debt of $17,500 is repaid by payments of $2850 made at the end of each year. Interest is 8%
compounded semi-annually. Complete parts (a) though (d) below.
(a) How many payments are needed to repay the debt?
The number of payments is 9
(Round up to the nearest whole number.)
(b) What is the cost of the debt for the first three years?
The cost of the debt for the first three years is $ 3,926.43
(Round to the nearest cent as needed.)
(c) What is the principal repaid in the fifth year?
The amount of the principal repaid in the fifth year is $
(Round to the nearest cent as needed.)
SIN
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