Bianca took out a loan from the bank today for X. She plans to repay this loan by making payments of 2,700 dollars per month for a certain amount of time. If the interest rate on the loan is 0.47 percent per month, she makes her first payment of 2,700 dollars later today, and she makes her final monthly payment of 2,700 dollars in 8 months, then what is X, the amount of the loan?
Answer : Principal Amoum=nt of loan is $ 21,150
Working notes for the above answer is as follow
We have provided with the information as follow
Bianca took out a loan from the bank today for X
interest rate on the loan is 0.47 percent per month
2,700 dollars later today, and she makes her final monthly payment of 2,700 dollars in 8 months
so calculation of the loan amount is as follow
Monthly EMI Budget Rs.: $ 2700
Annual Interest Rate: 0.47% x12 =5.67
Term of a Loan: 8 month
| Month | Principal amount |
Interest rate |
Installment | Principal | amount remaining |
| 1 | 21150 | 99.405 | 2700 | 2600.595 | 18549.405 |
| 2 | 18549.41 | 87.1822 | 2700 | 2612.818 | 15936.5872 |
| 3 | 15936.59 | 74.90196 | 2700 | 2625.098 | 13311.48916 |
| 4 | 13311.49 | 62.564 | 2700 | 2637.436 | 10674.05316 |
| 5 | 10674.05 | 50.16805 | 2700 | 2649.832 | 8024.221212 |
| 6 | 8024.221 | 37.71384 | 2700 | 2662.286 | 5361.935052 |
| 7 | 5361.935 | 25.20109 | 2700 | 2674.799 | 2687.136147 |
| 8 | 2687.136 | 12.86 | 2700 | 2687.14 | -0.234313381 |
