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Andy needs a loan that he will not have to pay back for 3 years. The interest rate for the

loan is 7.5% compounded quarterly. On the maturity date, wants Andy to make a single

payment of no more than $12000. What is the most Andy can borrow?

 Jan 28, 2022
 #1
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PV ==12,000 / [1  +  0.075/4]^(3*4)

 

PV ==12,000 / [1  +  0.01875]^12

 

PV ==12,000 / 1.2497163766

 

PV ==$9,602.18 - maximum amount that Andy can borrow.

 Jan 28, 2022
 #2
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thank u so much!

Timothy16  Jan 28, 2022

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