How much does she need to borrow to purchase the yacht

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Problem - On December 31, Beth Klemkosky bought a yacht for $70,000. She paid $20,000 down and agreed to pay the balance in 9 equal annual installments that include both the principal and 9 percent interest on the declining balance. How big will the annual payments be?

a. On December 31, Beth Klemkosky bought a yacht for $70,000 and paid $20,000 down, how much does she need to borrow to purchase the yacht?

b. If Beth agrees to pay the loan plus 9 percent compound interest on the unpaid balance over the next 9 years in 9 equal end-of-year payments, what will those equal payments be?

Reference no: EM132852540

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