Find the payment necessary to amortize a 4% loan of $ 1300 compounded quaterly, with...
Find the payment necessary to amortize a 4% loan of $ 1300 compounded quaterly, with 11 quarterly payments.
Answer & Explanation
Formulafor calculating compound interest:
P =principal amount (initial investment)
r =annual nominal interest rate (as a decimal)
n =number of times the interest is compounded peryear
t =number of years
A =amount after time ht
together nt = total no.periods
Aloan of $1300 at rate of 4% and it gets compounded quarterlyfor 11 quarters.
so,P = 1300$
nt= 11 quarters
r =4% = 4/100 = 0.04
so after 11 quarters the balance is,
Answer:- payment necessary to amortize the given loan is = 1450.37 $