Aa.63. 2) Consider an amortized loan at a nominal rate of 8% compounded monthly that will be re-paid over15 monthly payments starting at the end of the month. The first 5 payments are $650 each, the next5 are $500 each, and the final 5 are $250 each.a) What is the initial loan amount?b) Find the outstanding balance just after one year (12 payments)How much of payment 13 will be paid on principal?c)

The more is the compounding of interest than more is effective interest rate and due to which less…

rate of 8% compounded monthly that will be re-paid 15 monthly payments starting at the end of the month. The first 5 payments are $650 each, th 5 are $500 each, and the final 5 are $250 each. a) What is the initial loan amount? b) Find the outstanding balance just after one year (12 payments) c) How much of payment 13 will be paid on principal?

rate of 8% compounded monthly that will be re-paid 15 monthly payments starting at the end of the month. The first 5 payments are $650 each, th 5 are $500 each, and the final 5 are $250 each. a) What is the initial loan amount? b) Find the outstanding balance just after one year (12 payments) c) How much of payment 13 will be paid on principal?

Corporate Fin Focused Approach

5th Edition

ISBN:9781285660516

Author:EHRHARDT

Publisher:EHRHARDT

Chapter4: Time Value Of Money

Section4.17: Amortized Loans

Problem 1ST

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