Question 16 Tiff has taken a mortgage loan from ABC Bank, R 169,500, to be repaid over 2 years. Interest is charged at 15% pa compounded monthly, and payments are made at the beginning of each month. Calculate the balance on a mortgage loan after 13 payments. A R 81 938.16 B R 84 380.26 C R 78 268.60 D None of the above
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The formula for the monthly payment on a loan is: P = [r*PV] / [1 - (1 + r)^-n] where: P = monthly payment r = monthly interest rate (annual rate / 12) PV = present value, i.e., the loan amount n = number of payments In this case, r = 15% / 12 = 0.0125 (or Show more…
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