A debt pf $47,000 is repaid by payments of $4,333 made at the end of every six months. Interest is 8.6% compounded quarterly. Your calculator must be set to 2 decimals before doing any calculations that going to involve Amortization. a.) What is the value of 'p', the periodic interest rate? (Correct to exactly 8 decimal places.) b.) What is the number of payments required to retire the loan? (Rounded up to the next whole payment.) (Your answer must be a whole number.) c.) What is the (interest) cost of the debt for the first three years? (6 payments) (Use the BAII+: Do not calculate this by hand.) by d.) What is the value of the final (partial) payment? The final payment required to make the outstanding balance equal exactly zero. (Use the BAII+: Do not calculate this by hand.)
A debt pf $47,000 is repaid by payments of $4,333 made at the end of every six months. Interest is 8.6% compounded quarterly. Your calculator must be set to 2 decimals before doing any calculations that going to involve Amortization. a.) What is the value of 'p', the periodic interest rate? (Correct to exactly 8 decimal places.) b.) What is the number of payments required to retire the loan? (Rounded up to the next whole payment.) (Your answer must be a whole number.) c.) What is the (interest) cost of the debt for the first three years? (6 payments) (Use the BAII+: Do not calculate this by hand.) by d.) What is the value of the final (partial) payment? The final payment required to make the outstanding balance equal exactly zero. (Use the BAII+: Do not calculate this by hand.)
Cornerstones of Financial Accounting
4th Edition
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Jay Rich, Jeff Jones
ChapterA3: Time Value Of Money
Section: Chapter Questions
Problem 21E
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Transcribed Image Text:A debt pf $47,000 is repaid by payments of $4,333 made at the end of every six
months.
Interest is 8.6% compounded quarterly.
Your calculator must be set to 2 decimals before doing any calculations that are
going to involve Amortization.
a.) What is the value of 'p', the periodic interest rate?
(Correct to exactly 8 decimal places.)
b.) What is the number of payments required to retire the loan?
(Rounded up to the next whole payment.)
(Your answer must be a whole number.)
c.) What is the (interest) cost of the debt for the first three years? (6 payments)
(Use the BAII+: Do not calculate this by hand.)
Jhy
d.) What is the value of the final (partial) payment?
The final payment required to make the outstanding balance equal exactly zero.
(Use the BAII+: Do not calculate this by hand.)
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