Bobby Bragg has decided to buy a 10-year old car from Banger Motors for $6 000....

Bobby Bragg has decided to buy a 10-year old car from Banger Motors for $6 000. Rockwelle Finance has offered Bobby a 4-year loan at an annual interest rate of 15% p.a. with annual payments at the end of each year.

Required:

(1) What is Bobby’s annual loan repayment amount?

(2) What is the principal component of the year 2 loan repayment?

(3) What is the interest component of the year 3 loan repayment?

(4) What is the opening balance of the loan at the commencement of year 4?

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jeff jeffy answered 2 years ago

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