You borrowed $700 at 5% compounded quarterly. Yourpayments are $150 at the end of each year. How many years will you make payments on the loan? (Hint: compounding frequency is different from payment frequency; we know that r and t should be matched; compounding effect? Effective interest rate?)
You borrowed $700 at 5% compounded quarterly. Your
payments are $150 at the end of each year. How many years will you make payments on the loan?
(Hint: compounding frequency is different from payment frequency; we know that r and t should be matched; compounding effect? Effective interest rate?)
Expert Answer
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