Question: 4 . In a honey moon loan the borrower borrows $ 2 0 0 K and is charged interest rate 2 % ( per annum
In a honey moon loan the borrower borrows $K and is charged interest rate per annum for the first years and then per annum for the rest of the loan. Payments are made monthly at the end of the month. The loan is an interest only loan and will end after years.
i Calculate the payment per month that the borrower makes in the first years.
ii Calculate the payment per month for the rest of the loan.
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