Assume you take a loan of $10,000 with interest of 5%/year compounded yearly. You intend to pay it back through 5 equal yearly payments. Construct a tables showing the first two years of the loan, considering your loan defers payments for 1 year. The values must include: Principal, Interest, Total owed before payment, Yearly payment, Payment amount towards the interest, payment amount towards the principal, and remaining balance on the loan.

Assume you take a loan of $10,000 with interest of 5%/year compounded yearly. You intend to pay it back through 5 equal yearly payments. Construct a tables showing the first two years of the loan, considering your loan defers payments for 1 year. The values must include: Principal, Interest, Total owed before payment, Yearly payment, Payment amount towards the interest, payment amount towards the principal, and remaining balance on the loan.

Corporate Fin Focused Approach

5th Edition

ISBN:9781285660516

Author:EHRHARDT

Publisher:EHRHARDT

Chapter4: Time Value Of Money

Section4.17: Amortized Loans

Problem 1ST

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