QUESTION 2 (10 Marks)

You plan to buy a machine that has a total cost of RM90,400. You will make a down payment of 10% of the price of the machine. The remainder of the machines cost will be financed over a period of 5 years. You will repay the loan by making equal monthly payments. Your quoted annual interest rate is 10% compounded monthly.

1. What will the monthly payment be?

2. If you make a monthly payment at the beginning of every month, how would your answer change in (a)? Briefly explain.

Note: Dear sir don't give hand writing ... thank you