You're on your way to Montreal to get a very highly detailed arm sleeve tattoo by B.F. Bourbon of Bait & Schlang Tattoo. This one's going to run you a whopping $7,000, so you've arranged for a loan from good ol' Benny the loan shark, who's offering you a reasonable rate of 17%. (Reasonable, given you've got no credit history, given that it's less what your credit card charges, and given that the only collateral he's asking for is your arm.) You've agreed to a four year contract, with annual payments. (In this problem you may round all amounts to the nearest dollar.) 

a) How much will your loan payment be?

b) Set up (and then fill in) an amortization schedule.

Answer rating: 100% (QA)

a To calculate the annual loan payment use the formula for an amort... View the full answer