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A company borrowed $100,000 to finance a new product. The loan was for 20 years at a nominal interest rate of 8 percent compounded semiannually.

A company borrowed $100,000 to finance a new product. The loan was for 20 years at a nominal interest rate of 8 percent compounded semiannually. It was to be repaid in 40 equal payments. After one-half the payments were made, the company decided to pay the remaining balance in one final payment at the end of the 10th year. How much was owed? Answer: PW=$228,857.

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