Question

How much interest is to be paid in the second year of a 6-year loan of...

How much interest is to be paid in the second year of a 6-year loan of $100,000 with payments occurring at the end of each month, and a 6% annual interest rate compounded monthly?

I keep getting the wrong answer. I am not sure what I am doing wrong.

Homework Answers

Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
A $10000 loan has an interest rate of 12% per year, compounded monthly, and 30 equal...
A $10000 loan has an interest rate of 12% per year, compounded monthly, and 30 equal monthly payments are required. a) If payments begin at the end of the first month, what is the value of each payment? b) How much interest is in the 10th payment? c) What would you enter into Excel to solve part b? d) What is the unpaid balance immediately after the 10th payment? e) If the 30 loan payments are deferred and begin at...
Suppose a company is buying a piece of equipment for $ 140,000 and requires a loan...
Suppose a company is buying a piece of equipment for $ 140,000 and requires a loan to pay for it. The following options are given: a. Monthly payments for 3 years starting one month after the purchase, with an annual rate of 2.4% compounded monthly. b. Monthly payments for 3 years starting 6 months after the purchase, with an annual interest rate of 3.6% compounded monthly. c. Monthly payments for 3 years starting one month after the purchase with nominal...
Andrew takes out a 30-year home-loan of $650,000. The bank charges interest at 6% p.a. compounded...
Andrew takes out a 30-year home-loan of $650,000. The bank charges interest at 6% p.a. compounded monthly. Andrew repay the same amount at the end of each month for the whole loan term. Help Andrew to prepare the loan repayment schedule for month 61 below. (Round your answer to 2 decimal places. Do not include the $ symbol. Do not use comma separators. E.g. 1234.56) Month Opening balance of the loan Interest Paid Principal Paid Ending balance of the loan...
For a 8-year loan of $30,000 with an interest rate of 12% compounded monthly, What is...
For a 8-year loan of $30,000 with an interest rate of 12% compounded monthly, What is your monthly payment? What is the effective annual interest rate? What is the effective monthly interest rate? If I don’t make any payment for two years (assuming no penalties) and pay off the entire loan at the end of the second year, what amount do I need to pay? What is the economic equivalent value of $30,000 at this interest rate in 15 months...
You have just arranged a three-year bank loan for $200,000 at an interest rate of 8%...
You have just arranged a three-year bank loan for $200,000 at an interest rate of 8% p.a. with interest compounded monthly. The loan will be repaid in equal monthly instalments and the first payment will be due one month from today. Assuming end-of-the-month cash flows, the total interest paid in the second month will be closest to: $1,300. $1,333. $4,967. $6,267.
1) Calculate how much principal is paid in Year 1 for a loan in the original...
1) Calculate how much principal is paid in Year 1 for a loan in the original amount of $10,000, annual payments, at an interest rate of 5% per year, amortized over 5 years. A) $500 B) $1,809.75 C) $1,000 D) $519.99 2) For the loan in #1, how much interest is paid over the life of the loan? A) $1,548.74 B) $10,000 C) $2,309.75 D) $519.99
A loan was repaid over seven years by end-of-month payments of $450. If interest was 12%...
A loan was repaid over seven years by end-of-month payments of $450. If interest was 12% compounded monthly, how much interest was paid?
You have a 10 year loan for $50,000 and you make annual payments. The interest rate...
You have a 10 year loan for $50,000 and you make annual payments. The interest rate is 6% annual compounded quarterly.      a) What are your annual payments?      b) If the inflation rate is 3.2% annual compounded monthly, what is the purchasing power of your final payment in year 2 dollars?      c) What are the equal annual payments in year 2 constant dollars with the above inflation rate?      d) What is the total interest paid in year...
Suppose you take out a loan of $ 20,000 now (n=0), with an annual interest rate...
Suppose you take out a loan of $ 20,000 now (n=0), with an annual interest rate of 12 % compounded monthly (LIP = one month). The loan has to be paid back in 12 end-of-month payments, with the first payment made one month from now. The monthly payment is $ 1,776.00. What is the interest payment included in the sixth payment ?
A 100,000 loan is being repaid in 360 monthly installments at a 9% nominal annual interest...
A 100,000 loan is being repaid in 360 monthly installments at a 9% nominal annual interest rate compounded monthly. The first payment is due at the end of the first month. Determine which payment is the first where the amount of principal repaid exceeds the amount of interest paid. 266th 267th 268th 269th 270th