Homework Answers
Principal = $ 400,000
Rate = 8% p.a ., 2% per Quarter compounded
Payment = Semi Annually
No. of Years = 10 years
| Interest Amount | Payment Amount | |
| Year 1 | ||
| 1 | 8000 | |
| 2 | 8160 | 16160 |
| 3 | 8000 | |
| 4 | 8160 | 16160 |
| Year 2 | ||
| 1 | 8000 | |
| 2 | 8160 | 16160 |
| 3 | 8000 | |
| 4 | 8160 | 16160 |
| Year 3 | ||
| 1 | 8000 | |
| 2 | 8160 | 16160 |
| 3 | 8000 | |
| 4 | 8160 | 16160 |
| Year 4 | ||
| 1 | 8000 | |
| 2 | 8160 | 16160 |
| 3 | 8000 | |
| 4 | 8160 | 16160 |
| Year 5 | ||
| 1 | 8000 | |
| 2 | 8160 | 16160 |
| 3 | 8000 | |
| 4 | 8160 | 16160 |
| Year 6 | ||
| 1 | 8000 | |
| 2 | 8160 | 16160 |
| 3 | 8000 | |
| 4 | 8160 | 16160 |
| Year 7 | ||
| 1 | 8000 | |
| 2 | 8160 | 16160 |
| 3 | 8000 | |
| 4 | 8160 | 16160 |
| Year 8 | ||
| 1 | 8000 | |
| 2 | 8160 | 16160 |
| 3 | 8000 | |
| 4 | 8160 | 16160 |
| Year 9 | ||
| 1 | 8000 | |
| 2 | 8160 | 16160 |
| 3 | 8000 | |
| 4 | 8160 | 16160 |
| Year 10 | ||
| 1 | 8000 | |
| 2 | 8160 | 16160 |
| 3 | 8000 | |
| 4 | 8160 | 16160 |
Annual Interest Expense = $ 32320
Principal Amount = $ 400000
Effective Interest Rate =8.08% p.a.
n= 2
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