Question

A loan of $2000 is being repaid by equal monthly payments for an unspecified length of time. Interest on the loan is j2 = 15%. (Do not round intermediate calculations. Round your answers to 2 decimal places.)

a)	If the amount of principal in the 4th payment is $40, what amount of the 18th payment will be principal?

b)	Determine the regular monthly payment.

Answer 1

D Goal Seek ? X 2000 15% 0.0125 30.00 897 898 Debt 899 Interst rate 900 Month 901 Nper 902 903 =PPMT(15%/12,4,1901,-B898,0) 904 905 906 907 Set cell: B903 To value: By changing cell: $8$9011 OK Cancel 57.46!

Nper will change to 40.25

2000 15% 0.0125 40.25 4th Principal payment 40.00 897 898 Debt 899 Interst rate 900 Month 901 Nper 902 903 Excel formula 904 =PPMT(15%/12,4,B901,-B898,0) 905 906 a) 907 Excel formula 908 =PPMT(15%/12, 18,40.25,-2000,0) 909 b) 910 Excel formula 911 =PMT(15%/12,40.25,-2000,0,0) 912 18th Principal payment 47.60 Regular monthly payment 63.54 19