Question

A bank loan of $500 is arranged to be repaid in two years by equal monthly instalments. Interest, calculated monthly, is charged at 11% p.a on the remaining debt. Calculate the monthly repayment if the first repayment is to be made one month after the loan is granted.

Answer 1

let the payment be p
then i = .11/12 = .009166..
500 = p(1 - 1.0091666..^-24)/.0091666..


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