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A loan of 1 0 0 , 0 0 0 is to be repaid with level payments that are made at the end of year

A loan of

100, 000

is to be repaid with level payments that are made at the end of year for

10

years, based on an annual effective interest rate of

4 % .

Immediately after the second payment, the interest rate increases to

6 % .

The level payment amount remains unchanged, but the tenth payment becomes a balloon payment.

Calculate the amount of the balloon payment.

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