You owe your best friend $2,000. Because you are short on cash, you offer to repay the loan over 12 months under the following condition. The first payment will be $100 at the end of month one. The second payment will be $100 + G at the end of month two. At the end of month three, you will pay $100 + 2G. This pattern of increasing G amount will continue for all remaining months.

  (1) What is the value of G if the interest rate is 0.5% per month?

(2) What is the equivalent uniform monthly payment?

(3) Repeat Question (1) when the first payment is $150 (to determine G).

Answer rating: 100% (QA)

1 2000 100 PA05 12 G PG 05 12 100 116189 G ... View the full answer