You are told that a note has repayment terms of $850 per quarter for 5 years, with a stated interest rate of 8%. How much of the total payment is for principal, and how much is for interest? Calculate using a) financial calculator or b) Excel function PV. (Round answers to 2 decimal places, e.g. 5,275.25.)
Total payment for principal:
Total interest:
Determine if the total interest will be higher or lower than with an annual payment. The total interest will be [higher/lower] than with an annual payment.