An amount of $14,000 is borrowed from the bank at an annual interest rate of 11%. a. Calculate the equal end-of-year payments required to completely pay off the loan in 4 years. b. Calculate the repayment amounts if the loan ($14,000) will be repaid in two equal installments of $7,000 each, paid at the end of second and fourth years respectively. Interest will be paid each year. Click the icon to view the interest and annuity table for discrete compounding when i= 11% per year. ..... a. The equal end-of-year payments required to pay off the loan in 4 years are $ per year. (Round to the nearest dollar.)
An amount of $14,000 is borrowed from the bank at an annual interest rate of 11%. a. Calculate the equal end-of-year payments required to completely pay off the loan in 4 years. b. Calculate the repayment amounts if the loan ($14,000) will be repaid in two equal installments of $7,000 each, paid at the end of second and fourth years respectively. Interest will be paid each year. Click the icon to view the interest and annuity table for discrete compounding when i= 11% per year. ..... a. The equal end-of-year payments required to pay off the loan in 4 years are $ per year. (Round to the nearest dollar.)
Chapter19: Lease And Intermediate-term Financing
Section: Chapter Questions
Problem 10P
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Concept explainers
Mortgages
A mortgage is a formal agreement in which a bank or other financial institution lends cash at interest in return for assuming the title to the debtor's property, on the condition that the obligation is paid in full.
Mortgage
The term "mortgage" is a type of loan that a borrower takes to maintain his house or any form of assets and he agrees to return the amount in a particular period of time to the lender usually in a series of regular equally monthly, quarterly, or half-yearly payments.
Question
![An amount of $14,000 is borrowed from the bank at an annual interest rate of 11%.
a. Calculate the equal end-of-year payments required to completely pay off the loan in 4 years.
b. Calculate the repayment amounts if the loan ($14,000) will be repaid in two equal installments of $7,000 each, paid at the end of second and fourth
respectively. Interest will be paid each year.
years
Click the icon to view the interest and annuity table for discrete compounding when i= 11% per year.
a. The equal end-of-year payments required to pay off the loan in 4 years are $
per year. (Round to the nearest dollar.)](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F50db9cbd-b238-487c-bc0a-613e9098ea4e%2Fa08c6793-f98a-45f0-8145-09d599ca246f%2Fjm3752k_processed.jpeg&w=3840&q=75)
Transcribed Image Text:An amount of $14,000 is borrowed from the bank at an annual interest rate of 11%.
a. Calculate the equal end-of-year payments required to completely pay off the loan in 4 years.
b. Calculate the repayment amounts if the loan ($14,000) will be repaid in two equal installments of $7,000 each, paid at the end of second and fourth
respectively. Interest will be paid each year.
years
Click the icon to view the interest and annuity table for discrete compounding when i= 11% per year.
a. The equal end-of-year payments required to pay off the loan in 4 years are $
per year. (Round to the nearest dollar.)
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