Interest at 8 on a loan of 2000 is paid annually as it, Ask an Expert

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Interest at 8% on a loan of $2000 is paid annually as it falls due. A sinking fund is established at 5% to enable the borrower to repay the loan at the end of 8 years.

Eight equal annual payments will be made to the sinking fund, one at the end of each of the 8 years.

a) Find the sinking fund deposit;

b) Find the net outstanding balance on the loan at time 5 immediately after the 5^th outlay (including annual sinking deposit and interest due).

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Financial Management, Finance

Category:- Financial Management
Reference No.:- M92766885

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