Question: 8 . Jonathan believes he needs to purchase a new fully equipped bakery in order to satisfy the increasing demand for his product. The bakery

8. Jonathan believes he needs to purchase a new fully equipped bakery in order to satisfy the increasing
demand for his product. The bakery he wants to buy is worth $450,000. He can only afford to make a downpayment of $100,000 and needs to take out a loan from the bank in the amount of $350,000. The bank offers
him today a 30-year loan with equal annual payments. The interest rate is 7%. What must be his annual
payment so that he repays in 30 years the total loan that he obtains from the bank today? Assume his payments
will start in one year. Show your work. Draw a timeline.

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