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a. Calculate the interest component of Payment 10. Interest $. 1187.03 b. Calculate the principal component of Payment 40. Principal $1660.07 c. Calculate the total interest in Payments 29 to 40 inclusive. Total interest $ 6734.03

a. Calculate the interest component of Payment 10. Interest $. 1187.03 b. Calculate the principal component of Payment 40. Principal $1660.07 c. Calculate the total interest in Payments 29 to 40 inclusive. Total interest $ 6734.03

Corporate Fin Focused Approach
Corporate Fin Focused Approach
5th Edition
ISBN:9781285660516
Author:EHRHARDT
Publisher:EHRHARDT
Chapter4: Time Value Of Money
Section4.17: Amortized Loans
Problem 1ST
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The interest rate on a $59,000 loan is 8.9% compounded semiannually. Quarterly payments will pay off the loan in twelve years. (Do not round Intermedlate celculatlons and round your final answers to 2 declmal places.) a. Calculate the interest component of Payment 10. Interest $. 1187.03 b. Calculate the principal component of Payment 40. Principal $ 1660.07 c. Calculate the total interest in Payments 29 to 40 inclusive. Total interest $ 6734.03 d. Calculate the reduction of principal in Year 5. Principal reduction $ 4095.68 Mc Graw Hill < Prev 5 of 9 Next > correct W bo
Transcribed Image Text:The interest rate on a $59,000 loan is 8.9% compounded semiannually. Quarterly payments will pay off the loan in twelve years. (Do not round Intermedlate celculatlons and round your final answers to 2 declmal places.) a. Calculate the interest component of Payment 10. Interest $. 1187.03 b. Calculate the principal component of Payment 40. Principal $ 1660.07 c. Calculate the total interest in Payments 29 to 40 inclusive. Total interest $ 6734.03 d. Calculate the reduction of principal in Year 5. Principal reduction $ 4095.68 Mc Graw Hill < Prev 5 of 9 Next > correct W bo
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