Lynn and Gina purchased a hair salon business by agreeing to pay $2300 at the end of each month over the next three years. Interest on the “loan to purchase” agreement was 8.04% compounded monthly.
(a) What is the purchase price of the business?
(b) What is the outstanding principal of the loan after the 12th payment?
(c) What is the interest paid in the first year?
(d) How much principal is repaid in the first year?