Suppose you borrowed $30,000 on a student loan at a rate of 8% and must repay it in three equal installments at the end of each of the next 3 years. How large would your payments be, how much of the first payment would represent interest, how much would be principal, and what would your ending balance be after the first year? (PMT = $11,641.01; Interest = $2,400; Principal = $9,241.01; Balance at end of Year 1 = $20,758.99).

AppendixLO1