A character borrow $200 ti be repaid surrounded by 8 years near 14% annually compounded interes.?
The loan may be repaid at the finale of any previously year beside no prepayment cost.
a) What amount will be due if the loan is repaid at the wind up of year 1.
b) What is the repayment at the ending of year 4?
c)What amount is due at the back of the 8 th year?
Answers:
this is a intensely difficult query as you own made the comment compound..
i.e you remuneration an annual rate on the amount owing...
if we assume you recompense resembling a broad ridge loan adjectives interest is added at the start. as a consequence your 200 dollars would in truth propose a loan of 570.51 dollars.
this would niggardly a repayment of 5.94 dollars per month.
most companine will later proposition a abiding of interest for payments made before.
your 5.94 comprises 2.08 income repayment and 3.86 interest payment.
accordingly after yr 1 you would enjoy repaid 24.96 funds going away 175.04 dollars departed to retribution.
after year 4 you would own rewarded 94.40 of income pay for target lone 105.60 dollars moved out to be repaid..
and surrounded by year 8 you would own salaried adjectives of your monies and thereofore no payments due.
If however you be to amke no repayments at adjectives.
surrounded by yr 1 228would be the amount owed at appendage of yr1, 337.79 at the ending of yr 4 and 570.51 at the fall of year 8.
odd cross-examine but get me thinking for a couple of second,,,
i enjoy assumed annual calc of interest as monthly take ages to work out.
thus after year one you would own repaid merely
Is $200 not in the region of lb100? Why would it be borrowed over such a long time??
1st year $28
4th year $112
8th year $224
Why would you borrow $200 over an 8 year term?
That's really stupid.
First year $ 228
running out of 4 year $ 337.792
conclude of 8th year $ 570.518
take the time to swot Excell spread sheets ... theres a tool for amortization .. will show the monthly principal go together etc.
or shift to yahoo and use the mortgage calculator and print the monthly chart... merely remember to set taxes and insurance etc to 0
will show the interest and payments and running principal symmetry.
End of year 1, $200x 1.14= 228
End of year 4, $200x 1.14^4 = 338
End of year 8, $200x 1.14^8 = 571
But Rosa, if you can income 228 after one year. why can you not let go 200 within 10 months and not borrow anything?
The crazy thing nearly such matter is that the poorest folks settle up most for the things they buy. It is the rich individuals who can afford to borrow, not the poor..
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a) What amount will be due if the loan is repaid at the wind up of year 1.
b) What is the repayment at the ending of year 4?
c)What amount is due at the back of the 8 th year?
Answers:
this is a intensely difficult query as you own made the comment compound..
i.e you remuneration an annual rate on the amount owing...
if we assume you recompense resembling a broad ridge loan adjectives interest is added at the start. as a consequence your 200 dollars would in truth propose a loan of 570.51 dollars.
this would niggardly a repayment of 5.94 dollars per month.
most companine will later proposition a abiding of interest for payments made before.
your 5.94 comprises 2.08 income repayment and 3.86 interest payment.
accordingly after yr 1 you would enjoy repaid 24.96 funds going away 175.04 dollars departed to retribution.
after year 4 you would own rewarded 94.40 of income pay for target lone 105.60 dollars moved out to be repaid..
and surrounded by year 8 you would own salaried adjectives of your monies and thereofore no payments due.
If however you be to amke no repayments at adjectives.
surrounded by yr 1 228would be the amount owed at appendage of yr1, 337.79 at the ending of yr 4 and 570.51 at the fall of year 8.
odd cross-examine but get me thinking for a couple of second,,,
i enjoy assumed annual calc of interest as monthly take ages to work out.
thus after year one you would own repaid merely
Is $200 not in the region of lb100? Why would it be borrowed over such a long time??
1st year $28
4th year $112
8th year $224
Why would you borrow $200 over an 8 year term?
That's really stupid.
First year $ 228
running out of 4 year $ 337.792
conclude of 8th year $ 570.518
take the time to swot Excell spread sheets ... theres a tool for amortization .. will show the monthly principal go together etc.
or shift to yahoo and use the mortgage calculator and print the monthly chart... merely remember to set taxes and insurance etc to 0
will show the interest and payments and running principal symmetry.
End of year 1, $200x 1.14= 228
End of year 4, $200x 1.14^4 = 338
End of year 8, $200x 1.14^8 = 571
But Rosa, if you can income 228 after one year. why can you not let go 200 within 10 months and not borrow anything?
The crazy thing nearly such matter is that the poorest folks settle up most for the things they buy. It is the rich individuals who can afford to borrow, not the poor..