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40 19% Wed 3 Aa Present value of arnuity calculations are widely used for loan amortization and capital recovery probiems. Both loan amortization and capital

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40 19% Wed 3 Aa Present value of arnuity calculations are widely used for loan amortization and capital recovery probiems. Both loan amortization and capital necovery problems require the calculations of annuity payments based on a given required rate of return. Suppose yoa take out a loan. The process in which your debt will be paid off in equal instalments consisting of proportionate amounts of principal and nterest is caled fter Shipra got a job, the first thing she bought was a new car. She took out an amortized loan for $ 30,000-with no (90) down payment. She agreed to pay the loan by making annual paymensfor the next four years at the end of ead, year. Her bank is charging her an interest rate of 8% per year. Yesterday, she called to ask that you help her compute the annual payments necessary to repay her loan. Beginning Interest Paid Principal Paid Ending Balance 2 0

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