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Robert recently borrowed $20,000 to purchase a new car. The car loan is fully amortized over 4 years. In other words, the loan has a fixed monthly payment, and the balance on the loan will be zero after the final monthly payment is made. The loan has a nominal interest rate of 12 percent with monthly compounding. Looking ahead, Robert thinks there is a chance that he will want to pay off the loan early, after 3 years (36 months). What will the remaining balance be on the loan after he makes the 36th payment?
9-22 Your rich godfather has offered you a choice of one of the three following alternatives: $10,000 now; $2,000 a year for eight years; or $24,000 at the end of 8 years.
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