A person wants to borrow $100,000 to buy a house. He intends to pay back a fixed sum of $C at the end of each year, so that after 25 years he has completely paid off the debt. Assuming a steady interest rate of 4% per year, explain why:
I don't understand how is that even possible. If there's an interest rate of 4% per year, it should be a exponential growth, such that:
Total payable sum = $
~= 266584$ .. Dividing that by 25 gives $10,663 but that obviously isn't the answer.
I have tried many other ways but I don't seem to get it