A person borrows $10000 and agrees to repay a loan in equal instalments over 20 years. Interest is 12% pa on any money owing compounded quarterly.
Solve this using the present value formula ( he needs the money now )
`P= (x(1- (1+i)^-n))/ i` substitute all the known values
`10 000= (x(1-(1+ 0.12/4)^-(20times 4)))/ (0.12/4)` The interest is divided by 4...
(The entire section contains 102 words.)
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