Annuities
Alice and Bob take out a reducing balance loan of $20000 at a rate of 8% compounded half-yearly for 3 years and agree to repay 3815.24 every six months.
(a) What will be the balance after 2 years.
(b) How much interest have they paid so far?
Important This is not a 'textbook on a screen' - this is an interactive learning system. Which means you have to 'act' to make it go.
Look through the options below and select the one you think is the best response. You will gain most benefit if you work the problem with pen and paper as you go, i.e. decide what you think is the correct option and write down what you think the result will be before you click. If the next step doesn't display, click another option.
What's the first thing you need to do?
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