The interest rate on a $51,000 loan is 7.9% compounded semiannually. Quarterly payments will pay off the loan in twelve years. (Do not round intermediate calculations and round your final answers to 2 decimal places.) a. Calculate the interest component of Payment 10. Interest $ b. Calculate the principal component of Payment 40. Principal $ c. Calculate the total interest in Payments 27 to 40 inclusive. Total interest $ d. Calculate the reduction of principal in Year 5. Principal reduction
The interest rate on a $51,000 loan is 7.9% compounded semiannually. Quarterly payments will pay off the loan in twelve years. (Do not round intermediate calculations and round your final answers to 2 decimal places.) a. Calculate the interest component of Payment 10. Interest $ b. Calculate the principal component of Payment 40. Principal $ c. Calculate the total interest in Payments 27 to 40 inclusive. Total interest $ d. Calculate the reduction of principal in Year 5. Principal reduction
Chapter4: Time Value Of Money
Section4.17: Amortized Loans
Problem 1ST
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The interest rate on a $51,000 loan is 7.9% compounded semiannually. Quarterly payments will pay off the loan in twelve years. (Do not round intermediate calculations and round your final answers to 2 decimal places.)
a. Calculate the interest component of Payment 10.
Interest $
b. Calculate the principal component of Payment 40.
Principal $
c. Calculate the total interest in Payments 27 to 40 inclusive.
Total interest $
d. Calculate the reduction of principal in Year 5.
Principal reduction $
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