A loan of $90,500 is due 10 years from today. The borrower wants to make annual payments at the end of each year into a
Posted: Fri Jul 01, 2022 7:51 am
A loan of $90,500 is due 10 years from today. The borrower wantsto make annual payments at the end of each year into a sinking fundthat will earn compound interest atan annual rate of 10 percent.
Required:
a. What will the annual payments have tobe?
Note: Do not round intermediate calculations and roundyour final answer to the nearest whole dollar amount.
b. Suppose the investor makes the paymentsmonthly instead. How much would they need to pay eachmonth?
Note: Do not round intermediate calculations and roundyour final answer to 2 decimal places.
c. If payment was made by making monthlypayments with monthly compounding then how less they will pay in ayear?
Note: Do not round intermediate calculations and roundyour final answer to 2 decimal places.
Required:
a. What will the annual payments have tobe?
Note: Do not round intermediate calculations and roundyour final answer to the nearest whole dollar amount.
b. Suppose the investor makes the paymentsmonthly instead. How much would they need to pay eachmonth?
Note: Do not round intermediate calculations and roundyour final answer to 2 decimal places.
c. If payment was made by making monthlypayments with monthly compounding then how less they will pay in ayear?
Note: Do not round intermediate calculations and roundyour final answer to 2 decimal places.