A company financed the purchase of a machine with a loan at 2.75% compounded quarterly. This loan would be settled by making payments of $7,700 at the end of every quarter for 10 years.

a. What was the principal balance of the loan?

b. What was the total amount of interest charged on the loan?

You plan to save money for a down payment of $44,000 to purchase an apartment. You can only afford to save $6,000 at the end of every 6 months into an account that earns interest at 6.25% compounded monthly. How long will it take you to save the planned amount?

year(s) month(s)