Annual loan payment = [Loan Amount * ] / [1 - (1 + r)-n]
= [$150,000 * 0.05] / [1 - (1 + 0.05)-15]
= $7,500 / 0.5190 = $14,451.34
So, Option "C" is correct.
QUESTION 11 John takes out a loan of $150,000 to buy a house. He is offered...
QUESTION 4 John takes out a loan of $150,000 to buy a house. He is offered a 15-year loan by the bank, at an interest rate of 5% per year. That is, John must pay for the house with 15 equal annual 1. Finstallments, with an interest rate of 5%. What is the annual loan payment John must make? A. $17,160 "B. $17,812 c. $14,451 D. $13,526
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Toby is borrowing $500,000 to buy a house, and he will repay this loan with 25 equal yearly payments starting one year from today. If the effective annual interest rate is 14%, what is the dollar amount of each yearly payment? I don't know how to do this, please help. I don't JUST want the answer, I want an expalanation on how to do the problem and eventually get the answer myself. Thank you Toby is borrowing $500,000 to buy...
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