If you borrow $1,200 and agree to repay the loan in four equal annual payments a

Question

If you borrow $1,200 and agree to repay the loan in four equal annual payments at an interest rate of 10%, what will your payment be? (Do not round intermediate calculations. Round your answer to 2 decimal places.)

What if you make the first payment on the loan immediately instead of at the end of the first year? (Do not round intermediate calculations. Round your answer to 2 decimal places.)

If you borrow $1,200 and agree to repay the loan in four equal annual payments at an interest rate of 10%, what will your payment be? (Do not round intermediate calculations. Round your answer to 2 decimal places.)

Explanation / Answer

b)If you make your 1st payment on the date you take out the loan, you will save the 1st year's interest and pay off the loan 1 year earlier (end of the 3rd year). You still borrowed $1200.

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