Mrs.Thompson has taken a loan of 10,000 $ with a compound interest rate of 12%, with monthly payments for 36 months. At the end of the first year, after 12 payments, she wants to make an agreement with the bank and pay off his remaining debt in 8 equal quarterly payments. Since the interest rate and compounding frequancy are the same, what is the amount of these quarterly payments? a) 1.005 b) 1.420 c) 1.018 d) 922 (an explanation would be good)

Mrs.Thompson has taken a loan of 10,000 $ with a compound interest rate of 12%, with monthly payments for 36 months. At the end of the first year, after 12 payments, she wants to make an agreement with the bank and pay off his remaining debt in 8 equal quarterly payments. Since the interest rate and compounding frequancy are the same, what is the amount of these quarterly payments? a) 1.005 b) 1.420 c) 1.018 d) 922 (an explanation would be good)

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

Economics
Mrs.Thompson has taken a loan of 10,000 $ with a
compound interest rate of 12%, with monthly
payments for 36 months. At the end of the first
year, after 12 payments, she wants to make an
agreement with the bank and pay off his
remaining debt in 8 equal quarterly payments.
Since the interest rate and compounding
frequancy are the same, what is the amount of
these quarterly payments?
a) 1.005
b) 1.420
c) 1.018
d) 922
(an explanation would be good)

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