IME $301$ SP $2024$ T$1$

Page $3$

Name

Part II$.$ Problems

Problem $1$

An adjustable interest loan was taken by David Walker for a sum of $$20,000$ for $10$ years. The monthly interest rate was $0\mathrm{.}75\%$ with monthly compounding. After the first $60$ months payments were made, for the remaining $60$ months, the interest rate for the remaining balance of the loan at that time was reduced to $\frac{1}{2}\%$ for the last $60$ payments. Determine:

a$.$ the monthly payments for the first $60$ months.

b$.$ the loan balance immediately after the ${60}^{th}$ payment was made, and

c$.$ the monthly payments for the last $60$ months.