Question

Mary has a 6,000 loan and is being charged an interest rate of 8% convertible monthly for a term of four years. At the end of each month, Mary pays only half of the interest due. However, along with the tenth payment, Mary pays 3,000. What is her outstanding balance immediately after the tenth payment?

Answer 1

Hello Sir/ Mam

YOUR REQUIRED ANSWER IS $3,203.03

I'm solving this simply using excel spreadsheet. If you need any assistance regarding this, let me know in the comments.

Thanks!

		Interest
Time	Loan	Charged	Paid	Balance
0	$6,000.00	$0.00	$0.00	$6,000.00
1	$6,000.00	$40.00	$20.00	$6,020.00
2	$6,020.00	$40.13	$20.07	$6,040.07
3	$6,040.07	$40.27	$20.13	$6,060.20
4	$6,060.20	$40.40	$20.20	$6,080.40
5	$6,080.40	$40.54	$20.27	$6,100.67
6	$6,100.67	$40.67	$20.34	$6,121.00
7	$6,121.00	$40.81	$20.40	$6,141.41
8	$6,141.41	$40.94	$20.47	$6,161.88
9	$6,161.88	$41.08	$20.54	$6,182.42
10	$6,182.42	$41.22	$20.61	$6,203.03

As, along with the 10th payment, Mary paid $3,000, the outstanding balance = $6,203.03 - $3,000 = $3,203.03

I hope this solves your doubt.

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