Ian loaned his friend $20,000 to start a new business. He considers this loan to be...

 

Transcribed Image Text:

Ian loaned his friend $20,000 to start a new business. He considers this loan to be an investment, and therefore requires his friend to pay him an interest rate of 7% on the loan. He also expects his friend to pay back the loan over the next four years by making annual payments at the end of each year. Ian texted and asked that you help him calculate the annual payments that he should expect to receive so that he can recover his initial investment and earn the agreed-upon 7% on his investment. Calculate the annual payment and complete the following capital recovery schedule: Year Beginning Amount 1 2 3 4 $20,000.00 Payment Interest Paid Principal Paid Ending Balance 50.01 Ian loaned his friend $20,000 to start a new business. He considers this loan to be an investment, and therefore requires his friend to pay him an interest rate of 7% on the loan. He also expects his friend to pay back the loan over the next four years by making annual payments at the end of each year. Ian texted and asked that you help him calculate the annual payments that he should expect to receive so that he can recover his initial investment and earn the agreed-upon 7% on his investment. Calculate the annual payment and complete the following capital recovery schedule: Year Beginning Amount 1 2 3 4 $20,000.00 Payment Interest Paid Principal Paid Ending Balance 50.01

Answer rating: 100% (QA)

Year 7 Present value n4 geall PY A Beginn 20000 1... View the full answer