Amortization with Equal Payments Prepare an amortization schedule for a three-year loan of $69,000....

Question

Amortization with Equal Payments Prepare an amortization schedule for a three-year loan of $69,000. The interest rate is 9 percent per year, and the loan calls for equal annual payments. How much interest is paid in the third year? How much total interest is paid over the life of the loan?

Q

David · Accepted Answer

Loan amount = $69,000 
Interest Rate = 9% 
Cumulative discount factor for 3 years @9%  
= (1/1.09) + (1/(1.09)2)+ (1/(1.09)3) 
=0.92 + 0.84+ 0.77 
=2.5313 
Equated annual Installment of total repayment per year including principal + Interest= $69000 / 2.5313 
= $27,258.

Amortization with Equal Payments Prepare an amortization schedule for a three-year loan of $69,000. The interest rate is 9 percent per year, and the loan calls for equal annual payments. How much...

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