1.
In calculator: N=5
I/Y=6%
PV= -100,000 CPT PMT=23,739.64
Time
Payment
Interest in Pmt
Principal in
Payment
OLB
0
100,000.00
1
23,739.64
6,000.00
17,739.64
82,260.36
2
23,739.64
4,935.62
18,804.02
63,456.34
3
23,739.64
3,807.38
19,932.26
43,524.08
4
23,739.64
2,611.44
21,128.20
22,395.89
5
23,739.64
1,343.75
22,395.89
0.00
2a.
Total Amount of Principal=Total Loan Amount =
15,000.
b.
Interest Paid = Total Amount Paid – Total Loan Amount
= 10*2000 – 15,000 =
5,000.
3.
Total Amount Paid = Total Amount of Interest Paid + Total Loan Amount
Total Loan Amount = 950(4) – 800 = 3000.
In Calculator: PV=-3000
N=4
I/Y
PMT=950 CPT =
10.175%.
4.
Amount of Interest in 16
th
payment = (OLB
15
)(i
(12)
/12) = (8500)(.01) =
85.
5.
(i
(12)
/12)=.0075
OLB
8
=800
Princ
9
=90
Payment 9=(Principal in Pmt 9) + (Interest in Pmt 9) = 90 + (800)(.0075) =
96.
6.
We need to use the formula to calculate the principle in the kth year
1
nk
Qv
We know:
12
12
1.08
1
12
i
so
12
.00643403
12
i
Principle in the 120
th
payment:
121
890
n
Principle in the 40
th
payment:
41
n
Qv
x
Find x.
(
121)
121
1.00643403
890
890
1.00643403
n
n
Q
Q
Substitute the Q above for the Q in
41
n
Qv
x
41
80
121
890
1.00643403
890 1.00643403
532.80
1.00643403
n
n