A debt is amortized with 60 equal monthly payments at an annual effective interest rate of 12%. The amount of principal in the third payment is 900.

Calculate the amount of principal in the 33rd payment.

• 668
• 900
• 1008
• 1195
• 1213

Copyright 2023 . The Society of Actuaries, Schaumburg, Illinois. Reproduced with permission.

[[math]] \begin{aligned} & 1.12=\left[1+\frac{i^{(12)}}{12}\right]^{12} \\ & \frac{i^{(12)}}{12}=0.00948879 \\ & 900=P\left(\frac{1}{1.00948879}\right)^{60-3+1} \\ & P=1556.43 \\ & P_{33}=1556.43\left(\frac{1}{1.00948879}\right)^{60-33+1}=1194.78\end{aligned} [[/math]]

Copyright 2023 . The Society of Actuaries, Schaumburg, Illinois. Reproduced with permission.