You have a 5-year amortized loan with a nominal rate of 11% and annual payments of $541.14.What is the original (time 0)principal of the loan?
A) $2,000.00
B) $2,705.70
C) $2,289.31
D) $1,678.86
E) $2,051.35

Question

Quizplus · Accepted Answer

PV = PMT × 11ea7fdb_fc1f_8206_a768_a5a2a7a150ec_TB2902_11 PV = 541.14 × 11ea7fdb_fc1f_a917_a768_0f506022954c_TB2902_11 = $2,000
Using a financial calculator:
N = 5, I/Y = 11, PMT = -541.14, FV = 0, cpt PV = $2,000

You Have a 5-Year Amortized Loan with a Nominal Rate