Revision as of 21:35, 4 December 2023 by Admin (Created page with "'''Solution: C''' The fair monthly rate is <math>(1+0.08)^{1 / 12}-1=0.006434</math>. Let C be the appropriate monthly payment. Then, <math display = "block">\frac{C}{0.006434}\left[1-\frac{1}{1.006434^{120}}\right]=100,000.</math> C=$1,198.58. '''References''' {{cite web |url=https://alo.mit.edu/wp-content/uploads/2015/06/PS_Part1.pdf |last1=Lo |first1=Andrew W. |last2 = Wang | first2 = Jiang |website=alo.mit.edu | title = MIT Sloan Finance Problems and Solutions Co...")
Exercise
ABy Admin
Dec 04'23
Answer
Solution: C
The fair monthly rate is [math](1+0.08)^{1 / 12}-1=0.006434[/math]. Let C be the appropriate monthly payment. Then,
[[math]]\frac{C}{0.006434}\left[1-\frac{1}{1.006434^{120}}\right]=100,000.[[/math]]
C=$1,198.58.
References
Lo, Andrew W.; Wang, Jiang. "MIT Sloan Finance Problems and Solutions Collection Finance Theory I" (PDF). alo.mit.edu. Retrieved November 30, 2023.