Franz just took out a loan from the bank for 227,674 dollars. He plans to repay...

Franz just took out a loan from the bank for 227,674 dollars. He plans to repay this loan by making a special payment to the bank of 36,888 dollars in 5 months and by also making equal, regular monthly payments of X. If the interest rate on the loan is 1.06 percent per month, he makes his first regular monthly payment later today, and he makes his last regular monthly payment made in 9 months from today, then what is X, the amount of the regular monthly payment?

Solutions

Expert Solution

Regular monthly payment = $20,195.06

The loan schedule will be as follows:

Workings:

Note:

Since the first payment is made today, the principal will reduce directly to the extent of the payment made today without any interest.

jeff jeffy answered 1 year ago

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