A company borrows $130000, which will be paid back to the lender in one payment at the end of 8 years. The company agrees to pay semi-annually interest payments at the nominal annual rate of 13% compounded semi-annually. At the same time the company sets up a sinking fund in order to repay the loan at the end of 8 years. The sinking fund pays interest at an annual nominal interest rate of 8% compounded semi-annually. Find the total amount of the semi-annually payments, that is, the sum of the interest payment and the sinking fund payment.

Total semi-annually payment = $______________?

I thought I was using the right formula but now I'm not sure what I'm doing wrong can you please explain how so I can figure out what I'm doing wrong

• The present value of an annuity= Annuity payments * (1- (1+ rate) ^-n ) / rate