Question

Problem 9 - Unknown Time & Unknown Interest Rate

At a constant force of interest of 5%, a loan is being repaid with 3 payments: a payment of 1000 at the end of 10 years, a payment of 4000 at the end of 20 years, and a payment of 10000 at the end of 30 years.
Compute the time T the borrower could repay the loan with a single payment of 11500.

T=

(Give your answer correct to 2 decimal places)

Answer 1

-Loan+1000*e^(-5%*10)+4000*e^(-5%*20)+10000*e^(-5%*30)=0

=>Loan=4309.35

-4309.35+11500*e^(-5%*T)=0

=>T=19.63 years