An auto repair shop borrowed $15,000 to be repaid by semi-annual payments over 8 years. Interest on the loan is 12% compounded semi-annually. (a) What is the size of the periodic payment? (b) What is the outstanding principal after payment 10? (c) What is the interest paid on payment 11? (d) How much principal is repaid in payment 11?
An auto repair shop borrowed $15,000 to be repaid by semi-annual payments over 8 years. Interest on the loan is 12% compounded semi-annually. (a) What is the size of the periodic payment? (b) What is the outstanding principal after payment 10? (c) What is the interest paid on payment 11? (d) How much principal is repaid in payment 11?
Chapter4: Time Value Of Money
Section4.17: Amortized Loans
Problem 1ST
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An auto repair shop borrowed $15,000 to be repaid by semi-annual payments over 8 years. Interest on the loan is 12% compounded semi-annually.
(a) What is the size of the periodic payment?
(b) What is the outstanding principal after payment 10?
(c) What is the interest paid on payment 11?
(d) How much principal is repaid in payment 11?
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