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.-3. juu ting annuity payments) (Related to Checkpoint 6.1 on page 196) James Har- rison bought a house for £180,000. He paid
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Answer #1

equated annual payment = r *p / [1-(1+r)^(-n)]

here,

r=6%=>0.06.

p = 180,000 -20,000 down payment

=>160,000.

n=25.

now,

annual installments = (160,000*0.06) / [1-(1.06)^(-25)]

=>9600/ 0.7670014

=>$12,516.27.

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