Revision as of 14:28, 19 November 2023 by Admin (Created page with "'''Solution: A''' The outstanding loan balance at any point in time is equal to the present value (at that same point in time) of the remaining installment payments. <math display = "block"> B_{40}=1000(0.98)^{40}\left[\frac{1-\left(\frac{0.98}{1.0075}\right)^{20}}{0.0075+0.02}\right]=6889.11 </math> {{soacopyright | 2023 }}")
Exercise
ABy Admin
Nov 19'23
Answer
Solution: A
The outstanding loan balance at any point in time is equal to the present value (at that same point in time) of the remaining installment payments.
[[math]]
B_{40}=1000(0.98)^{40}\left[\frac{1-\left(\frac{0.98}{1.0075}\right)^{20}}{0.0075+0.02}\right]=6889.11
[[/math]]
Copyright 2023 . The Society of Actuaries, Schaumburg, Illinois. Reproduced with permission.