Anita borrows 540,000 at annual effective interest rate 3%. She repays this loan by paying off only the interest due at the end of each year to the lender and depositing a level amount Q at the end of...
Anita borrows 540,000 at annual effective interest rate 3%. She repays this loan by paying off only the interest due at the end of each year to the lender and depositing a level amount Q at the end of each year into a sinking fund account paying 6% APY. The goal is to accumulate the full balance of the loan amount in the sinking fund at the end of 10 years.
b. What rate (AEIR) does Anita end up paying on this loan?
Homework Answers
We see that using excel the rate Anita ends up paying on the
loan=RATE(10,540000*3%+540000*6%/(1.06^10-1),-540000)
=1.050%
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Anita borrows 540,000 at annual effective interest rate 3%. She repays this loan by paying off only the interest due at the end of each year to the lender and depositing a level amount Q at the end of...
thumbs up for correct solution 10. Anita borrows 540,000 at annual effective interest rate 3%. She repays this loan by paying off only the interest due at the end of each year to the lender and depo...
thumbs up for correct solution
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thumbs up for correct solution
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Please post with mathematical formulas please, no an excel
sheet
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