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*PLEASE NO EXCEL! ONLY FORMULAS!* Alex takes out a $100,000 loan for 12 years. The applicable annual effective interest rate is a promotional rate of

*PLEASE NO EXCEL! ONLY FORMULAS!*

Alex takes out a $100,000 loan for 12 years. The applicable annual effective interest rate is a promotional rate of 3% for the first two years and 6.5% for the remainder of the loan term. Alex makes payments at the end of each year. Alexs payments increase by 8% each year.

(a) Find the amount of the first payment.

(b) Find the balance of the loan immediately following his 6th payment.

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