Revision as of 01:44, 19 November 2023 by Admin (Created page with "Payments of 1000 at the end of each year are paid on a loan of 12,000. The payments are based on an annual effective interest rate of 10%. Calculate the outstanding loan balance immediately after the 12 th payment <ul class="mw-excansopts"><li>3270</li><li>3572</li><li>3758</li><li>3796</li><li>3834</li></ul> {{soacopyright | 2023 }}")
Nov 19'23
Exercise
Payments of 1000 at the end of each year are paid on a loan of 12,000. The payments are based on an annual effective interest rate of 10%.
Calculate the outstanding loan balance immediately after the 12 th payment
- 3270
- 3572
- 3758
- 3796
- 3834
Copyright 2023 . The Society of Actuaries, Schaumburg, Illinois. Reproduced with permission.
Nov 19'23
Solution: D
Using the retrospective method,
[[math]]
12,000(1.10)^{12}-1000s_{\overline{{{12}}}|0.10} = 37, 661.14 -1000(21.38428) =16, 276.86.
[[/math]]
Copyright 2023 . The Society of Actuaries, Schaumburg, Illinois. Reproduced with permission.