Question

A loan of € 30,000 should be 10% p.a. Interest through constant annuities in a term of Be paid back 6 years. Do you create the repayment plan?

Answer 1

Annuity factor for 6 years at 10% per year	= (1-(1/(1+r)^n))/r
				= ((1-(1/(1+0.1)^6))/0.1,4)
				= 4.3553
Therefore Annual installment amount	=30000/4.3553
				=6888.16
Year	Opening Balance	Installment Amount	Interest Amount (10% on Closing value)	Principle Amount	Closing Balance
0					30,000.00
1	30,000.00	6,888.16	3,000.00	3,888.16	26,111.84
2	26,111.84	6,888.16	2,611.18	4,276.98	21,834.86
3	21,834.86	6,888.16	2,183.49	4,704.67	17,130.19
4	17,130.19	6,888.16	1,713.02	5,175.14	11,955.05
5	11,955.05	6,888.16	1,195.50	5,692.66	6,262.39
6	6,262.39	6,888.16	625.77	6,262.39	0.00