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November 23, 2014

November 23, 2014

Posted by **Danielle** on Monday, November 14, 2011 at 7:59am.

- math -
**Reiny**, Monday, November 14, 2011 at 9:36am1200 = 20(1 - 1.015^-n)/.015

0.9 = 1-1.015^-n

1.015^-n = 0.1

log (1.015^-n) = log 0.1

-n = log 0.1 / log 1.015 = -154.65

n = appr 155 months

About 13 years !!!

Seems harsh, but that is reality.

Considering that the interest in the first month is $18, he pays back only about $2 a month for quite some time

e.g.

2nd month:

Balance = 1198.00

interest = 17.97

repayment = $2.03

3rd month:

Balance = 1198.97

interest = 17.94

repayment = $2.06

4th month:

Balance = 1193.91

interest = 17.91

repayment = $2.09

etc.

notice that the repayment increases only by about 3 cents per month for quite a while.

- math -
**Clara**, Monday, November 14, 2011 at 2:55pmThanks, how much money will the bank receive at the end of the 13 years?

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