Question

A loan of 189,000 is going to be repaid by month-end repayments of 4,000 starting in one month. The interest rate is 4.2% p.a. compounded monthly. Calculate the loan outstanding balance at the end of year 2. Correct your answer to the nearest cent without any units. (Do not use "$" or "," in your answer. e.g. 12345.67)

Answer #1

Let's first calculate the total term of the loan in months. The same can be calculated using the NPER function in excel.

Term of the loan = NPER (Rate, PMT, PV, FV) = NPER (4.2%/12, 4000, -189000, 0) = 51.74

After 2 years, number of payments left = NPER = 51.74 - 2 x 12 = 27.74

Hence, loan outstanding = PV of all the future payments = -PV (Rate, Nper, PMT, FV) = -PV(4.2%/12, 27.74, 4000, 0) = 105,566.69

HEnce, your final answer is 105,566.69

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A
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can you please do my question with TI BA calculator.

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