Dominic borrows 7200 dollars today, and agrees to repay the loan by making annual interest payments to the lender, and by also accumulating a sinking fund with increasing annual deposits to repay the principal. The interest rate on the loan is 8.8 percent, and the interest paid on the sinking fund is 6.7 percent, both effective. If the loan is to be settled 15 years from now, and the sinking fund deposits increase by 7 dollars per year, what is Dominic's total outlay at the end of the 6th year? (Assume the first interest payment and sinking fund deposits are both due in one year.)
 

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To solve this problem we can break it down into steps 1Calculate the annual interest pay... View the full answer