Quantitative Problem: You need $16,000 to purchase a used car. Your wealthy uncle is willing to lend you the money as an amortized loan. He would like you to make annual payments for 5 years, with the first payment to be made one year from today. He requires a 7% annual return.

a) What will be your annual loan payments? Round your answer to the nearest cent. Do not round intermediate calculations.

b) How much of your first payment will be applied to interest and to principal repayment? Round your answer to the nearest cent. Do not round intermediate calculations. Interest: $ Principal repayment: $