[tex]10%/24 = 0.2106[/tex]is the monthly interest rate.
10% is the nominal interest rate.
interest rate each month =[tex]10%/10 = 1%[/tex]
1% monthly instalment at A1 =[tex]$26,000 (A/P, 1%, 60) = $15600[/tex])
There will be 36 more payments after the 24th before the loan is paid off.
As a result, the loan balance following the 24th payment is $[tex]15600 (P/A, 1%, = $156)[/tex] iii). The nominal interest rate is 9%, hence the monthly interest rate is 9%/24, which equals [tex]0.00375%.[/tex]
A2 =[tex]$156 (A/P, 0.00375%, 36) = $0.2106[/tex] )for a monthly payment at [tex]0.00375%[/tex]annual interest.
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