Now assume the borrower can take a two month loan. For a two month loan:

A loan of sizeLis made. First month interest is calculated on the total amountL using the monthly interest rate. The first repayment is subtracted from the total repayment burden (including first month interest) in the first month. Second month interest (again using the monthly rate) is calculated on what's left of the loan and interest AFTER the first payment. The second repayment should equal whatever is left to be repaid (including second month interest) in the second month.

Q Assume the borrower repays the same amountmin both months. Express the payment amountmin terms ofLandk

Q Under the same set up, what is the largestm that the borrower can afford to pay back each month? Do not include the loan itself in your answer and express it as a function of y and c