A debt of $10,000 with interest at 7.6%p.a compounding quarterly is to be repaid with 9 equal end-of-quarter payments.
How much interest is in the final instalment?
(Hint use excel: You can either:
- First calculate the loan outstanding at the beginning of the last quarter. The interest can then be calculated as if you were setting up a loan repayment schedule for the final quarter.
- Use IPMT function)
8.A loan of 220,000 is to be repaid in 20 years by month-end repayments starting in one month. The interest rate is 6.4% p.a. compounded monthly. Calculate the principal paid in Year 6. (between the end of month 60 and the end of month 72). Correct your answer to the nearest cent without any units. (Do not use "$" or "," in your answer. e.g. 12345.67) (Hint: you can use Excel to find the answer.)
