Eliza takes out a $36,000 loan at an annual effective interest rate of 6%. It is...

Eliza takes out a $36,000 loan at an annual effective interest rate of 6%. It is agreed that at the end of each of the first six years she will pay $1,800 in principal, along with the interest due, and that at the end of each of the next eight years she will make level payments of $2,500. Eliza will make on final payment at the end of fifteen years to exactly complete her loan obligation. Calculate the amount of Eliza’s fifth payment, the amount of her tenth payment, and the amount of her fifteenth payment. The answers are fifth=3528, tenth=2500, and 15th=16346.58. Please show steps leading to answer without use of excel.

Solutions

Expert Solution

I have typed this sum, No excel formula is used only finanacial Calculater.

Prepare a schedule In which opening balance is the amount outstanding brought forward.

Interest is calculated as Opening balance left * 6%

Repayment is as per the calculation.

Closing balance is the Opening + interest - Repayment.

Please give a like if you get it. Thank you

jeff jeffy answered 1 year ago

Next > < Previous

Related Solutions

Susana takes out a $1,000 loan. The loan carries a 10% annual interest rate and it...

Susana takes out a $1,000 loan. The loan carries a 10% annual interest rate and it will be amortized with fixed annual payments over a five-year period. Construct the amortization schedule for this loan? What is the fraction of the fixed payment represent the repayment of principal in year 2? Assume Annual Compounding Show Formula Find Annual Payment Create Amortization Table Show fraction of the fixed payment represents the repayment of principal in year 2

Jenny takes out a 10-year loan of 100,000 at an annual effective rate of 8%. At...

Jenny takes out a 10-year loan of 100,000 at an annual effective rate of 8%. At the end of each year Jenny makes interest payments to the lender and sinking fund deposits into a sinking fund earning 6% annual effective. Jenny's first sinking fund deposit is $1000 and the remaining deposits are level. a) Find the total (net) interest paid on the loan. b) How would the total (net) interest paid on the loan change if the interest rate on...

A borrower takes out a 30-year mortgage loan for $100,000 with an interest rate of 6%...

A borrower takes out a 30-year mortgage loan for $100,000 with an interest rate of 6% plus 4 points. Payments are to be made monthly. a. What is the effective cost of borrowing on the loan if the loan is carried for all 30 years? b. What is the effective cost of borrowing on the loan if the loan is repaid after 10 years?

A borrower takes out a 30-year mortgage loan for $250,000 with an interest rate of 6%...

A borrower takes out a 30-year mortgage loan for $250,000 with an interest rate of 6% and monthly payments. What portion of the first month's payment would be applied to interest? ($1250) Assume the question above was a negative amortization loan, what would be the balance after 3 years?

Kevin takes out a loan of 2000 dollars to buy a car at an effective annual...

Kevin takes out a loan of 2000 dollars to buy a car at an effective annual rate of interest of 6%. He repays the loan by making level annual payments at the end of each year for 10 years, using the amortization method. Find the outstanding loan balance at the end of the 1st year just after the 1st payment is paid

The effective semi-annual interest rate is 5%. The equivalent effective monthly rate is ___________ (Carry out...

The effective semi-annual interest rate is 5%. The equivalent effective monthly rate is ___________ (Carry out 4 places after the decimal point, and write the answer as a decimal)

A small business takes out a $100,000 loan on April 1, 2020. The loan interest rate...

A small business takes out a $100,000 loan on April 1, 2020. The loan interest rate is j4 = 6%. They are to repay the loan with quarterly payments of $4,000 for 5 years (first payment on July 1, 2020), followed by n quarterly payments of 5,000 for as long as necessary. Determine the total number of loan payments made and both the amount and calendar date of the smaller final payment made one quarter after the last 5,000 payment.

Given a loan with the following characteristics: Co = 50,000€ Annual effective interest 6% to be...

Given a loan with the following characteristics: Co = 50,000€ Annual effective interest 6% to be amortized in 6 years, and knowing it is a level-fixed payment-rate loan. Just before making the payment of the second annuity, it is decided to change the amortization method, starting to be amortized through constant principal repayments loan. a) Outstanding debt just after making the payment of the 3th annuity b) Amortization schedule for the last 3 years

a borrower takes out a 15 year mortgage loan for 100,000 with an interest rate of...

a borrower takes out a 15 year mortgage loan for 100,000 with an interest rate of 5% plus 3 points. what is the effective annual interest rate on the loan if the loan is carried 15 years.

A 20 year loan of $50, 000 is taken out at effective annual interest i =...

A 20 year loan of $50, 000 is taken out at effective annual interest i = 6% for the first 10 years and then i = 7% for the next 10 years. Payments are constant at the end of each year. Find the outstanding balance after the 16th payment.

Subjects