A loan of $12,500 is made at an effective interest rate of 8.5%. Payments are made at the end of each interest period. Each payment equals twice the interest due until the borrower pays off the outstanding debt with a final payment of, at most, $1800. Find the number of payments n and the amount the final payment. ** Answers are n=24 and final payment = $1758.02.
A loan of $12,500 is made at an effective interest rate of 8.5%. Payments are made at the end of each interest period. Each payment equals twice the interest due until the borrower pays off the outstanding debt with a final payment of, at most, $1800. Find the number of payments n and the amount the final payment. ** Answers are n=24 and final payment = $1758.02.
Chapter16: Working Capital Policy And Short-term Financing
Section: Chapter Questions
Problem 14P
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Plz don't use excel.
![A loan of $12,500 is made at an effective
interest rate of 8.5%. Payments are made at
the end of each interest period. Each
payment equals twice the interest due until
the borrower pays off the outstanding debt
with a final payment of, at most, $1800. Find
the number of payments n and the amount of
the final payment. ** Answers are n=24 and
final payment = $1758.02.
Please no excel. Steps would be very helpful.
Thank you!](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F36a5af16-d4e5-4739-97c6-a689d65ecb82%2Fad95cc95-bd02-4f55-a33d-e8bffa5a85a9%2Fqs790bs_processed.jpeg&w=3840&q=75)
Transcribed Image Text:A loan of $12,500 is made at an effective
interest rate of 8.5%. Payments are made at
the end of each interest period. Each
payment equals twice the interest due until
the borrower pays off the outstanding debt
with a final payment of, at most, $1800. Find
the number of payments n and the amount of
the final payment. ** Answers are n=24 and
final payment = $1758.02.
Please no excel. Steps would be very helpful.
Thank you!
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