The table attached represents quarterly payments of a two year loan with a different APR each...
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The table attached represents quarterly payments of a two year loan with a different APR each year. Use the factor notation process to answer the following questions: 1st year Payments: $500 per quarter. First payment starts at period one. Interest rate: 6% compounded quarterly. 2nd year Payments: $750 per quarter. First payment starts at period five. Interest rate: 7% compounded monthly a) Use the outline below to draw the cash flow diagram and load appropriately. 0 6% 1 7% 2 b) Determine the amount of K, C, N and calculate the effective interest rate for each zone. Zone I K = C = N = Effective i = Zone II K = C = N = Effective i = rounded = c) Compute the amount of the loan (Pv). The table attached represents quarterly payments of a two year loan with a different APR each year. Use the factor notation process to answer the following questions: 1st year Payments: $500 per quarter. First payment starts at period one. Interest rate: 6% compounded quarterly. 2nd year Payments: $750 per quarter. First payment starts at period five. Interest rate: 7% compounded monthly a) Use the outline below to draw the cash flow diagram and load appropriately. 0 6% 1 7% 2 b) Determine the amount of K, C, N and calculate the effective interest rate for each zone. Zone I K = C = N = Effective i = Zone II K = C = N = Effective i = rounded = c) Compute the amount of the loan (Pv).
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