A contractor’s price for a new building was $96 000. Slade Inc., the buyers of the building, paid $12 000 down and financed the balance by making equal payments at the end of every 6 months for 12 years. Interest is 7.3% compounded semi- annually.
(a) What is the size of the semi-annual payment?
(b) For the first payment period, how much interest is paid, how much of the principal is repaid, and what is the loan balance?
(c) For the second payment period, how much interest is paid, how much of the principal is repaid, and what is the loan balance?
(d) What is the total cost of the building for Slade Inc.?
(e) What is the total interest included in the payments?