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December 21, 2014

December 21, 2014

Posted by **Kimberly** on Thursday, December 15, 2011 at 5:08pm.

What is the monthly payment for this loan?

Show the formula that you used and the values used for each variable to calculate the monthly payment.

What is the unpaid balance of the loan at the end of the 1st year?

Show the formula that you used and the values used for each variable to calculate the unpaid balance at the end of the 1st year.

What is the unpaid balance at the end of the 6th year? Show the formula that you used and the values used for each variable to calculate the unpaid balance at the end of the 6th year.

- Algebra -
**Reiny**, Thursday, December 15, 2011 at 5:31pmi = .09/12 = .0075

n = 12(7) = 84

let the payment be P

50000 = P(1 - 1.0075^-84)/.0075

P = 804.45

balance after 1 year

= 50000(1.0075)^12 - 804.45(1.0075^12 - 1)/.0075

= 44628.62

do the same steps for the last part of your question.

- Algebra -
**Kimberly**, Thursday, December 15, 2011 at 5:36pmCould you please show me all the steps. I really need to understand this. there are 3 parts to be answered. I am so confused

Thank you so much..

- Algebra -
**Reiny**, Thursday, December 15, 2011 at 5:55pmI used the formula

Amount of single lump sum of money

= Principal (1 + i)^n

the present value of an annuity

PV = P( 1 - (1+i)^-n)/i

and the amount of an annuity

amount = P( (1+i)^n - 1)/i

where P is the annuity payment, i is the interest rate of each period expressed as a decimal and n is the number of periods

I showed all the steps necessary, I am sure you can insert any intermediate arithmetic answers if you need them

- Algebra -
**Kimberly**, Thursday, December 15, 2011 at 7:26pmBalance owed at end of year 6

= 50000(1.0075)^72 - 804.45(1.0075^72 - 1)/.0075 = $9,198.86

Total repayment+ $67,574.13 based on $50,000 at 9% for 7 years.

Is this correct? Thanks for your help

- Algebra -
**Kimberly**, Thursday, December 15, 2011 at 7:49pmbalance after 6 years

= 50000(1.0075)^72-804.45(1.0075^72 - 6)/.0075= 9198.86

- Algebra -
**Kimberly**, Thursday, December 15, 2011 at 7:50pmis that correct... Please

check it

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