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Cal Lury owes $10,000 now. What will his annual payment be?

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35. Cal Lury owes $10,000 now. A lender will carry the debt for five more years at 10 percent interest. That is, in this particular case, the amount owed will go up
by 10 percent per year for five years. The lender then will require that Cal pay
off the loan over the next 12 years at 11 percent interest. What will his annual
payment be?

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Solution Summary

Computation are done by hand with formulas and work shown (not excel or financial calculator).

Solution Preview

PV = 10000
n = 5
Rate = 10%
Then compute FV = PV * (1+r)^n = ...

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