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Aerotron Electronics has just bought a used delivery truck for $15,000. The small business paid $1,000 down and financed the rest, with the agreement to pay nothing for the entire first year and then to pay $546.83 at the end of each month over years 2, 3, and 4 (first payment is in 13th month).
a. What nominal interest rate is Aerotron paying on the loan?
b. What effective interest rate are they paying?
c. How much of the 14th month’s payment is interest? How much is principal? payment interest = $____, and principal = $_____
d. How much of the 18th month’s payment is interest? How much is principal? payment interest = $_____, and principal = $_____
e. How much of the 22nd month’s payment is interest? How much is principal? payment interest = $_____, and principal= $_____
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