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