In: Economics
Your company has a $800,000. loan for a new plasma cutting machine. The interest rate for this loan is 5% per year compounded annually. Your company will make $75,000 payment at the end of each year, starting the end of this year. How many payments (years) will the loan of $800,000. be paid off?
a- 14
b- 15
c- 16
d- 17
18
Borrowed amount = $ 800,000
Interest rate = 5%
Annual payment = $ 75,000
Correct answer is 17.14.