Question

A man has a loan of 50,000 for 10 years ay 6.5% annually with annual payments. His payments are 4500 for the first 5 years and X for the next 5 years. Find X.

Answer 1

X is 10,319.12

Step-1:Balance of Loan amount at the end of 5 Years
Year	Beginning Loan	Annual Payment	Interest Expense	Principal Payment	Ending Loan amount
	a	b	c=a*6.5%	d=b-c	e=a-d
1	50,000.00	4,500.00	3,250.00	1,250.00	48,750.00
2	48,750.00	4,500.00	3,168.75	1,331.25	47,418.75
3	47,418.75	4,500.00	3,082.22	1,417.78	46,000.97
4	46,000.97	4,500.00	2,990.06	1,509.94	44,491.03
5	44,491.03	4,500.00	2,891.92	1,608.08	42,882.95
Step-2:Calculation of X
Annual payment for last 5 years	=-pmt(rate,nper,pv,fv)
	= 10,319.12
Where,
rate	=	6.50%
nper	=	5
pv	=	42,882.95
fv	=	0