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Math Help - Refinance

  1. #1
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    Refinance

    Does any body know a quick easy way to solve this problem:

    A small business has 2 loans to repay.the 1st loan $45000 at7.3% pa,is due as a single repaymnet in 5 yrs tme.the 2nd loan of $10000 at 6.8% pa is due to be completly paid as a single repayment in 3 yrs.the business owner approaches a bank and the bank agrees to refinance the loans at 7.25% pa due in 6 yrs time as a single repayment.how much does the business have to repay the bank in 6 yrs time.
    (all interest rates compound yearly).
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  2. #2
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    (PV = Present Value)

    a = PV of 45000 ; 45000 / 1.073^5
    b = PV of 10000 ; 10000 / 1.068^3

    New loan: (a + b)(1.0725)^6
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  3. #3
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    beaten by wilmer..
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  4. #4
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    I think the 45000 and the 10000 are amounts due 5 and 3 years from now, Robb;
    Anyhoo....we can let Heatly take his pick
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