John borrows $15000 for 5 years at an annual effective interest rate of %9. At the end of each year she pays the lender $1000 and deposits a level amount necessary to repay the loan in full after 5 years into a sinking fund that earns an annual effective interest rate of %4. Determine the total annual payment that John makes.
John borrows $15000 for 5 years at an annual effective interest rate of %9. At the end of each year she pays the lender $1000 and deposits a level amount necessary to repay the loan in full after 5 years into a sinking fund that earns an annual effective interest rate of %4. Determine the total annual payment that John makes.
Chapter5: Introduction To Business Expenses
Section: Chapter Questions
Problem 61P
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John borrows $15000 for 5 years at an annual effective interest rate of %9. At the end of each year she pays the lender $1000 and deposits a level amount necessary to repay the loan in full after 5 years into a sinking fund that earns an annual effective interest rate of %4. Determine the total annual payment that John makes.
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