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[RHINO7]

Could someone please show the working out for these loan repayment questions.

i) David borrows $5000 from the bank and pays back the loan in monthly payments over 4 years. If the loan incurs interest of 21% p.a., find the amount of each repayment.

ii) A loan of $6000 is paid back in equal yearly instalments over 3 years. If the interest is 21.5% p.a., find the amount of each yearly instalment. How much money is paid back altogether?

 

[pLuvia]

i) 5000(1+0.21/12)⁴⁸=R[((1+0.21/12)⁴⁸-1)/(0.21/12)]

Solve for R and you will get your monthly repayments

ii) 6000(1.215)³=R[((1.215)³-1)/(0.215)]

Solve for R

 

[RHINO7]

I made a stupid mistake in i) but i'm still having trouble with the second one. Here's what i've got---

number of payments=3
interest= 21.5%

a=1, r=1.215, n=3

S3= 1(1.215^3-1)/(1.215-1)

6000(1.215^3)(0.215)/(1.215-1)

= 1076.168025

which is wrong.