Revision as of 13:50, 19 November 2023 by Admin (Created page with "A loan of 50,000 id based on an annual effective interest rate of 6%. You are given: #The loan is to be repaid with quarterly payments of 2125 and a final drop payment. #The first payment is due 1.5 years after the loan is taken out. Calculate the number of payments of 2125 to be made. <ul class="mw-excansopts"><li>28</li><li>29</li><li>30</li><li>31</li><li>32</li></ul> {{soacopyright | 2023 }}")
ABy Admin
Nov 19'23
Exercise
A loan of 50,000 id based on an annual effective interest rate of 6%. You are given:
- The loan is to be repaid with quarterly payments of 2125 and a final drop payment.
- The first payment is due 1.5 years after the loan is taken out.
Calculate the number of payments of 2125 to be made.
- 28
- 29
- 30
- 31
- 32
Copyright 2023 . The Society of Actuaries, Schaumburg, Illinois. Reproduced with permission.
ABy Admin
Nov 19'23
Solution: D
[[math]]
\begin{aligned}
& 1.06=\left[1+\frac{i^{(4)}}{4}\right]^4 \\
& \frac{i^{(4)}}{4}=0.014674 \\
& 50,000(1.014674)^5=2,125 a_{\overline{n}|} \\
& n=31.86
\end{aligned}
[[/math]]
There will be 31 payments of 2125 .
Copyright 2023 . The Society of Actuaries, Schaumburg, Illinois. Reproduced with permission.