Question

The following table shows a portion of a four-year amortization schedule. A 4-year amortization schedule. The loan amount or principal is 19,900 dollars. At 25 months, the balance of the loan is 10,356 dollars and 3 cents.
After twenty-five payments, how much of the principal has been paid off?


a. $2,669.28

b. $10,353.25

c. $9,543.97

d. $12,213.25

Answer 1

Answer:

• Option c. $ 9,543.97

Explanation:

The row for month 25 shows that after twenty-five payments the balance of the loan is  $10,356.03

You are told that the loan amount or principal is $ 19,900.

From those two data, you can calculate how much of the principal has been paid off after 25 months, because the amount paid off is equal to the loan less the balance after 25 payments:

• Principal paid off = $ 19,900 - $ 10,356.03 = $9,543.97