What would be the amount of the payments for a $10,000 loan at 15%? with the fol

Question

What would be the amount of the payments for a $10,000 loan at 15%? with the following payment schedule: two equal payments, one due two years from now and the other the 4th year.

I need to find the amounts of the payments (For the 2 year and 4th year)

This are the formula I have studied so far in class..

(http://wps.prenhall.com/wps/media/objects/5569/5703580/ch02_images/table_2.10.jpg)

Im kind of confused because the payments are every two years.. Can someone help me with the process to get the values ? Thanks

Explanation / Answer

Let the equal payment = X

10000 = (X/1.15^2)+(X/1.15^4)

solve for X

X = 10,000/((1/1.15^2)+(1/1.15^4)) = $7530.71

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