(SOLVED) Consider a loan of $17000 with monthly payments of $1100 at a rate of 3.1% compounded semi-annually.
Discipline: Finance
Type of Paper: Question-Answer
Academic Level: Undergrad. (yrs 1-2)
Paper Format: APA
Pages: 1
Words: 158
Question
Consider a loan of $17000 with monthly payments of $1100 at a rate of 3.1% compounded semi-annually.
Calculate how much interest is paid on this loan within the first 7 payments.
Expert Solution Preview
First we need to convert the compounded semi-annually into monthly compounding interest
|
EAR |
3.1000% |
|
Number of times in a year |
2 |
|
APR |
3.0763% |
|
Excel Formula |
NOMINAL(0.031,2) |
The EAR and APR is found with the help of ..............
