Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

SHOW WORKING NOT EXCEL PLEASE A loan of $1,000,000 is made today. The interest being charged on this loan is 6% p.a. The borrower will

SHOW WORKING NOT EXCEL PLEASE A loan of $1,000,000 is made today. The interest being charged on this loan is 6% p.a. The borrower will make 30 level repayments followed by a final smaller repayment (i.e., there are 31 repayments in total.). The first of the level repayments will occur today, and each subsequent repayment (including the final smaller repayment) will occur exactly 1 year after the previous repayment. Explicitly, the final repayment will occur exactly 30 years from today

a) Calculate the size of the level repayments, if the final smaller repayment is $15,000. Round your results to two decimal places.

b) Calculate the amount of the final smaller repayment, if the the size of the level repayments is $68,000. Round your results to two decimal places.

(c) Calculate the loan outstanding exactly 20 years from today (after the repayment being made on that day), if the size of the level repayments is $68,200 and the final smaller repayment is $28,216.78. Round your results to two decimal places.

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

The Handbook Of Post Crisis Financial Modelling

Authors: Emmanuel Haven, Philip Molyneux, John Wilson, Sergei Fedotov, Meryem Duygun

1st Edition

1137494484, 978-1137494481

More Books

Students also viewed these Finance questions