Homework Answers
1) When loan payments are amortized, then the total amount you owe every month is called the periodic payment and from that payment some portion is paid towards the interest and some portion is paid towards the principal payment.
2) The amount of interest payment decreases each month because interest is paid on the principal outstanding and as loan payment is made towards the principal the outstanding principal reduces and so does the interest payment.
3) The principal payment in the periodic payment increases over time and the interest payment decreases over time.
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Use Excel to create an amortization table showing, for each of the
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Answer the following, rounding to the nearest penny.
a) Find the amount of each payment. $
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A loan of $450,000 is amortized over 30 years with payments at
the end of each month and an interest rate of 6.3%, compounded
monthly.
Use Excel to create an amortization table showing, for each of the
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principal, the payment amount, and the ending balance.
a) Find the amount of each payment. $
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