Han Xiao just closed a $50,000 business loan that she must repay her brother, who has agreed to lend it at 5% annual interest. Han must repay the loan over the next 5 years, in 5 equal, end-of-year payments.

a. How much does Han have to pay every year if she has to repay the loan by the fifth end-of-year installment?

b. Prepare an amortization schedule showing the interest and principal breakdown of each loan payments.

c. Explain why the interest expense of each subsequent payment declines over time.