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bill and laura borrowed $15 000 at 6 per annum compounded monthly for 30 years to purchase a home. Their monthly payment is determined to be $899.63.

Find a recursive formula for their balance after each monthly payment has been made.
Determine Bill and Laura's balance after the first payment.

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Leticia

  1. r = (6%/12)/100% = 0.005 = Monthly % rate expressed as a decimal.

    I = 0.005 * 150000 = $750.00 = Int. for
    1st month.

    ---Payments---Interest.-Prin.--Bal.
    1. $899.33----750.00---149.33-149850.67

    2. $899.33----749.25---150.08-149700.59

    3. $899.33----748.50---150.83-149549.77

    NOTE: The int. is always 0.005 times the
    unpaid Bal.

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    Henry

  2. Nice job

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    Kimberly

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