You borrowed 6,000 from the Angelo Bank for a new air conditions ystem. The loan is...

Question

Question

Answer 1

Answer #1

Annual Installment = Loan Amount / Present Value Annuity factor of 10% for 5 years

= $6,000 / [1/(1.1)¹ + 1/(1.1)² + 1/(1.1)³ + 1/(1.1)⁴ + 1/(1.1)⁵]

= $6,000 / 3.7908 = 1582.78

So balance after third year payment is $ 2746.98.

Answer 2

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