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Math Help - Company must repay money

  1. #1
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    Question Company must repay money

    A company borrows $75,000 which is to be repaid with equal payments semiannually for 10 years. The interest rate is 10%. Find the semiannual payments.
    My answer is $3,750.00, is this right. Thanks for looking at my answer.
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  2. #2
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    Quote Originally Posted by kwtolley
    A company borrows $75,000 which is to be repaid with equal payments semiannually for 10 years. The interest rate is 10%. Find the semiannual payments.
    My answer is $3,750.00, is this right. Thanks for looking at my answer.
    Your answer is just 75,000/20. What about the interest? A loan is just like an annuity. Use the PVIFA table with 20 periods and 5% interest per period. Or if you have an annuity formula, use that.
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