Question
N5 a) Show that the following equation is true: (P/F, i, n) = (P/A, i, n-1). Explain why it is true. b) You currently carry
N5
a) Show that the following equation is true: (P/F, i, n) = (P/A, i, n-1). Explain why it is true.
b) You currently carry a loan of $6000 on your credit card that charges 18% APR compounded monthly. Design a minimum payment plan with reason. Estimate the time required to repay the loan.
c) What is the effective interest rate paid on the loan?
d) Explain why A/P, i, 1 = F/P, i, 1 holds true for all values of i.
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Macroeconomics Principles Applications and Tools
Authors: Arthur O'Sullivan, Steven Sheffrin, Stephen Perez
9th edition
978-0134089027, 134089022, 978-0134420684
