Q5. The information below provides details of a loan which is used to purchase a Lamborghini.

Car details:

Lamborghini Aventador 2020 S Roadster model.

Price = $950,000, 0 kilometers.

Engine = 12-cylinder petrol aspirated 6.5 liters.

Transmission = 7 speed sports automatic single clutch.

Specifications = Two door, convertible, snow white color.

Loan details

Today is June 30, 2020, which is the initiation date of the loan.

You obtain a fixed rate loan with principal and interest payments from

Westpac.

The amount borrowed is $950,000 to buy a Lamborghini Aventador.

The nominal interest rate associated with this fixed rate loan is the Reserve Bank of Australia cash rate (as at June 30 2020) plus a margin of 3.75%. This interest rate is compounded monthly and is fixed from the initiation date.

The maturity date of the loan is 4 years.

The financial year ends on 30 June each year.

Assume the following payments during the term of the loan:

Repayments of $10,000 at the end of each month beginning on July 31 2020 until 30 June 2024 (inclusive).

September 30 2022: a single payment of $120,000.

January 31 2023: a single payment of $150,000.

A condition of the loan is that you must make payments of at least $90,000 by the end of each financial year.

Given such payments, your job is to determine the outstanding value of the loan on June 30, 2024.