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A loan of $ 10000 is to be repaid in 30 equal monthly installments with the...

A loan of $ 10000 is to be repaid in 30 equal monthly installments with the first one paid seven months after the loan is made. The nominal annual interest rate is 6 % compounded quarterly. Determine the amount of the monthly payment.
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Answer #1
First we have to convert the quarterly rate in EAR and than monthly compunded rate
EAR = (1+6%/4)^4-1 6.14%
Annual rate (Monthly compounding) = ((1+6.41%)^(1/12)-1)*12
5.97%
Future value of the loan at the end of 6th month
put in calculator
PV -10000
PMT 0
I 5.97%/12 0.4975%
N 6
Compute FV $10,302.25
Computation of monthly rate
put in calculator
FV 0
PV ($10,302.25)
I 0.4975%
N 30
Compute PMT $370.53
Ans = $370.53
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