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Math Help - Simple Annuities #2

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    Ife
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    Simple Annuities #2

    Another question, i have the answer, but i am not sure if my working is the right working.

    'A car loan of $10,000 at  J_{12}=12% is being paid off by n monthly payments. The first (n-1) payments are $263.34 per month. The final payment is $263.24.

    Determine the duration of the loan.


    What i did was:

    10000 = 263.34 \left[ \frac{1-(1+i)^{-n}}{i} \right]

    where i= \frac{0.12}{12}, and n= unknown. After simplification i get n=47.99

    Is this working correct? I didn't include the n-1 or the final payment in my calculation, so I think I am wrong.
    Last edited by mr fantastic; December 8th 2009 at 01:21 AM. Reason: Changed post title
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