A loan is repayable by a decreasing annuity payable annually in arrears for 20 years. The repayment at the end of the first year is $6 000 and subsequent repayments reduce by $200 each year. The repayments were calculated using a rate of interest of 9% per annum effective. Calculate the original amount of the loan.
A loan is repayable by a decreasing annuity payable annually in arrears for 20 years. The repayment at the end of the first year is $6 000 and subsequent repayments reduce by $200 each year. The repayments were calculated using a rate of interest of 9% per annum effective. Calculate the original amount of the loan.
Chapter19: Lease And Intermediate-term Financing
Section: Chapter Questions
Problem 15P
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A loan is repayable by a decreasing
Calculate the original amount of the loan.
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