A 10-year loan of 2000 is to be repaid with payments at the end of each...
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A 10-year loan of 2000 is to be repaid with payments at the end of each year. It can be repaid under the following two options: (i) Equal annual payments at an annual effective rate of i. (ii) Installments of 200 each year plus interest on the unpaid balance at an annual effective rate of 5%. The sum of the payments under option (i) equals the sum of the payments under option (ii). Determine i. (A) 4.3% (B) 4.5% (C) 4.7% (D) 4.9% (E) 5.1% A 10-year loan of 2000 is to be repaid with payments at the end of each year. It can be repaid under the following two options: (i) Equal annual payments at an annual effective rate of i. (ii) Installments of 200 each year plus interest on the unpaid balance at an annual effective rate of 5%. The sum of the payments under option (i) equals the sum of the payments under option (ii). Determine i. (A) 4.3% (B) 4.5% (C) 4.7% (D) 4.9% (E) 5.1%
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Related Book For
Finite Mathematics and Its Applications
ISBN: 978-0134768632
12th edition
Authors: Larry J. Goldstein, David I. Schneider, Martha J. Siegel, Steven Hair
Posted Date:
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