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Sue will need $120,000 to refurbish her house at the corner of a main road into a cake shop in 5 years. She has a saving acco
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Answer #1

a). FV = P[(1+r)^n - 1]/r where P = 800; n = 5*12 = 60; r = monthly rate = 3.47%/3 = 1.15667%

FV = 800*[(1+1.15667%)^60 - 1]/1.15667% = 68,731.96

Sue will not have enough money after 5 years. She will be short by 120,000 - 68,731.96 = 51,268.04

b). Biannual payment amount = 3,472.53

Values Formula 51268.04 18 9*2 2.18% =4.35%/2 3472.53 =PMT(E125,E124,-E123) rate PMT

c). Loan amortization schedule:

BP- 1 Bn-1 - Pn Formula Bn-1*rate Number of Biannual payments (n) payment (BP) Interest (0) 0 1 L 3472.53 1115.08 2 3 472.531

Note: The Excel file configuration is not provided in the question, so the most commonly used amortization schedule format has been taken. Please modify as per your requirements.

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