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27 April, 07:06

John takes out a loan of $150,000 to buy a house. He is offered a 15-year loan by the bank, at an interest rate of 5% per year. What is the annual loan payment John must make?

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  1. 27 April, 07:29
    0
    15104,994511758 average a year

    Explanation:

    1st year he has to pay 10500

    2nd year 11025

    3rd year 11576,25

    4th year 12155,0625

    5th year 12762,815625

    6th year 13400,95640625

    7th year 14071,004226562

    8th year 14774,5543789

    9th year 15513,2821597984

    10th year 16288,946267773

    11th year 17103,393581161

    12th year 17958,563260219

    13th year 18856,49142323

    14th year 19799,315994391

    15th year 20789,28179411

    Simply adding a 5% rate to a previous year

    In this way a total is

    226574,91764658

    Divided in number of years (15) gives an average of

    15104,94511758 a year
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