Question: Greg has agreed to repay a debt by using the following repayment schedule. Starting today, he will make $100 payments at the beginning of each
Greg has agreed to repay a debt by using the following repayment schedule. Starting today, he will make $100 payments at the beginning of each month for the next two-and-a-half years. After two-and-a-half years, he will make $200 payments at the beginning of each month for one year, which will pay off his debt completely. For the first two-and-a-half years, the interest on the debt is 9% compounded monthly. For the final year, the interest is lowered to 8.5% compounded monthly. Determine the size of Greg's debt as of today.
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