Discount loan (interest and principal at maturity). Chuck Ponzi has talked an elderly woman into loaning him $20,000 for a new business venture. She has, however, successfully passed a finance class and requires Chuck to sign a binding contract on repayment of the $20,000 with an annual interest rate of 9% over the next 20 years. Determine the cash flow to the woman under a discount loan, in which Ponzi will hav a lump-sum payment at the end of the contract. ….…. What is the amount of payment that the woman will receive at the end of years 1 through 19? $ (Round to the nearest cent.)
Discount loan (interest and principal at maturity). Chuck Ponzi has talked an elderly woman into loaning him $20,000 for a new business venture. She has, however, successfully passed a finance class and requires Chuck to sign a binding contract on repayment of the $20,000 with an annual interest rate of 9% over the next 20 years. Determine the cash flow to the woman under a discount loan, in which Ponzi will hav a lump-sum payment at the end of the contract. ….…. What is the amount of payment that the woman will receive at the end of years 1 through 19? $ (Round to the nearest cent.)
Chapter4: Time Value Of Money
Section: Chapter Questions
Problem 25PROB
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