exercise:887f90c8b6: Difference between revisions
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The second borrower is charged a monthly effective interest rate of 2.01% and makes level end- | The second borrower is charged a monthly effective interest rate of 2.01% and makes level end- | ||
of-month payments of 2.01X for 200 months to pay off the loan. | of-month payments of 2.01X for 200 months to pay off the loan. | ||
Calculate n. | |||
<ul class="mw-excansopts"><li>200</li><li>250</li><li>300</li><li>350</li><li>400</li></ul> | <ul class="mw-excansopts"><li>200</li><li>250</li><li>300</li><li>350</li><li>400</li></ul> | ||
{{soacopyright | 2023 }} | {{soacopyright | 2023 }} | ||
Latest revision as of 09:37, 22 November 2023
A bank offers a loan to each of two borrowers with different credit scores. Both loans are for the same amount. The first borrower is charged a monthly effective interest rate of 1% and makes level end-of- month payments of X for n months to pay off the loan. The second borrower is charged a monthly effective interest rate of 2.01% and makes level end- of-month payments of 2.01X for 200 months to pay off the loan.
Calculate n.
- 200
- 250
- 300
- 350
- 400
Copyright 2023 . The Society of Actuaries, Schaumburg, Illinois. Reproduced with permission.