Axl will be borrowing $300,000 today to buy a house, and he will pay it back with 20 yearly payments starting one year from toda

Question

3 years ago

5

y. If the effective annual interest rate is 7%, how much will the first payment be if the annual payments are constant

1 answer:

Natalija [7] · Answer 1 · 2022-08-14T15:57:23+03:00

4 0

Answer:

$28,317.88.

Explanation:

The annual payment, PMT can be determined using a financial calculator as follows :

PV = $300,000

N = 20

P/YR = 1

R = 7.00 %

FV = $0

PMT = ?

Using a financial calculator, the annual payment, PMT is $28,317.88.