Understanding Re Amortizing a Loan: Steps and Considerations
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Consider a 4-year amortizing loan. You borrow 1,000 initially and repay it in four equal annual year-end payments. (LOS-3) a. If the interest rate is 8 %, what is the annual payment? b. Fill in the following table, which shows bow much of each payment is interest versus principal repayment (that is, amortization) and the outstanding balance on the loan at each date. Time Loan Balance ( Year-End Interest Due on Loan Balance ( Total Yea
Consider a 4-year amortizing loan. You borrow 1,000 initially and rep…
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