a)
First we have to find the payment, assume it is made at the end of each year
15000000= pay( 1 - 1.12^-5)/.12
pay = 4161145.98
Paym# interest principal Balance
1 1800000.00 2361145.98 12638854.02
2 1516662.48 2644483.45 9994370.52
3 1199324.46 2961821.52 7032549.01
4 843905.89 3317240.10 3715308.91
5 445837.07 3715308.91 0.00
not bad,
now do b) the same way
your payment equation will be
25000000 = pay( 1 - 1.0625^-6)/.0625
Construct a schedule for the amortization of:
(a) a debt of $15,000,000 with interest at 12% by 5 equal annual payments.
(b) a debt of $25,000,000 with interest at 12.5% compounded semi-annually by making 6 equal semi-annual payments.
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