Tan YourSelf Inc. wishes to pay off a debt of $38,000 in 6 years. What amortization payment would they need to

2 Responses to Tan YourSelf Inc. wishes to pay off a debt of $38,000 in 6 years. What amortization payment would they need to

1. Tony Q

   February 18, 2010 at 2:14 am

   1st my guess you are in canada, their mortg is compounded semi-annually.

   m=2 compound semi-annually
   pv=38,000
   %int=6 annual interest

   yr= ??? years amortization

   int= (%int) / 100 /m
   int= 6/100/2
   int= 0.03

   n= (m) * (yr)
   n= 2 * (yr)

   factor F1 = pv * [(1 + int) ^ (m / 12) - 1]
   F1 = 38000 * [(1 + 0.03) ^ (2 / 12) -1]
   F1 = 187.667637

   factor F2 = [1 – (1 + int) ^ ( – n )

   pmt = monthly payment = (F1) / (F2)

   from my excel calculation we have the following table

   for yr = 25
   pmt = $243.13
   F2=0.77189292

   for yr =20
   pmt=270.63
   F2=0.69344316

   for yr=15
   pmt=319.16
   F2=0.58801324
2. mister ed

   February 18, 2010 at 10:42 am

   here again take you homework to the homework secton!!!