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April 28, 2024, 12:55:05 am
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Author Topic: Reducing Balance loans  (Read 644 times)  Share 

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khalil

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Reducing Balance loans
« on: August 30, 2009, 07:46:32 am »
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Jimmy borrows $4000 from the bank, at an interest rate of 12% per annum compounded monthly. He makes regular monthly repayments of $500. How much of the principal has he repaid after three months.

Using the TVM solver, does anyone know that N, P/Y and C/Y are in this question?
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VxBlitzxN

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Re: Reducing Balance loans
« Reply #1 on: August 30, 2009, 06:59:26 pm »
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uh.
N=3   
P/Y = 12
C/Y = 12
Solve for FV subtract that from the P.
At least i think so. Reducing Balance Loans suck >.>
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khalil

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Re: Reducing Balance loans
« Reply #2 on: August 31, 2009, 10:57:11 am »
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Yeh, I found out the answer, thats correct, my problem was that the Pmt should be -500
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