Financial Maths Help! Watch

geodawson
Badges: 1
Rep:
?
#1
Report Thread starter 5 years ago
#1
Maddie and Lee have a house loan for $220 000 at 8.5% p.a. compounded monthly. They pay $2050 per month.
(a) How much will they owe on the house after 7 years?
(b) If they pay a lump sum of $8000 on the loan after 7 years from the start , determine the new repayments to pay out the loan in another 10 years

Please, please help me! I can't for the life of me work out part b or understand how to do it :mad:
0
reply
lubus
Badges: 11
Rep:
?
#2
Report 5 years ago
#2
You know how much they owe at t=7. Subtract 8000 to find the present value of that loan.

Then use standard geometric progression to find out the amount of the repayments. Essentially you will have an 10 year p-thly annuity with present value (answer from part b) - 8000.
1
reply
X

Quick Reply

Attached files
Write a reply...
Reply
new posts
Latest
My Feed

See more of what you like on
The Student Room

You can personalise what you see on TSR. Tell us a little about yourself to get started.

Personalise

University open days

  • Arts University Bournemouth
    Art and Design Foundation Diploma Further education
    Sat, 25 May '19
  • SOAS University of London
    Postgraduate Open Day Postgraduate
    Wed, 29 May '19
  • University of Exeter
    Undergraduate Open Day - Penryn Campus Undergraduate
    Thu, 30 May '19

How did your AQA GCSE Physics Paper 1 go?

Loved the paper - Feeling positive (423)
30.26%
The paper was reasonable (551)
39.41%
Not feeling great about that exam... (239)
17.1%
It was TERRIBLE (185)
13.23%

Watched Threads

View All