Homework Help: Finance

Posted by Mary on Monday, February 8, 2010 at 12:06am.

Mrs. Smith borrowed $20,000 from Last National Bank. She will repay the loan with 5 annual payments and her interest rate is 14%. a) Find the amount of her annual payments. b) What is her loan balance after she has made her 3rd annual payment?

Finance - drwls, Monday, February 8, 2010 at 11:25am
Use the amortization tool at
http://www.bretwhissel.net/cgi-bin/amortize

The annual payment amount is 5825.67

There is also a formula you can use, but it is rather hard to memorize. You find it at
http://www.vertex42.com/ExcelArticles/amortization-calculation.html

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