Question
A loan of $100,000 is being repaid with geometrically increasing payments at the end of each year for 20 years. The first payment is X.
A loan of $100,000 is being repaid with geometrically increasing payments at the end of each year for 20 years.
The first payment is X.
The second payment is X(1.05).
The third payment is X(1.05)^2.
The payment continue to increase until X is paid at the end of the 20th year.
The annual effective interest rate on the loan is 5%.
Determine the amount of principal in the 19th payment.
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Fundamentals of Financial Management
Authors: Eugene F. Brigham, Joel F. Houston
Concise 6th Edition
324664559, 978-0324664553
