Loan = principal-down = 750000-75000=675000
|
EAR = [(1 +stated rate/no. of compounding periods) ^no. of
compounding periods - 1]* 100 |
| ?
= ((1+6/(4*100))^4-1)*100 |
|
Effective Annual Rate% = 6.1364 |
|
EAR = [(1 +stated rate/no. of compounding periods) ^no. of
compounding periods - 1]* 100 |
|
6.1364 = ((1+Stated rate%/(12*100))^12-1)*100 |
|
Stated rate% = 5.9703 |
a
|
PVOrdinary Annuity = C*[(1-(1+i/100)^(-n))/(i/100)] |
| C
= Cash flow per period |
| i
= interest rate |
| n
= number of payments |
|
675000= Cash Flow*((1-(1+
5.9703/1200)^(-15*12))/(5.9703/1200)) |
|
Cash Flow = 5685.21 |
b
|
PVOrdinary Annuity = C*[(1-(1+i/100)^(-n))/(i/100)] |
| C
= Cash flow per period |
| i
= interest rate |
| n
= number of payments |
|
PV= 5685.21*((1-(1+ 5.9703/1200)^(-10*12))/(5.9703/1200)) |
|
PV = 512775.1 |
c
total paid = CF*years*months per year =
5685.21*15*12=1023337.8
d
Interest =total paid-loan = 1023337.8-675000=348337.8
