Question

You are considering taking out a loan of $10,000.00 that will be paid back over 9 years with quarterly payments of $381.39. If the interest rate is 7.3% compounded quarterly, what would the unpaid balance be immediately after the ninth payment?

The unpaid balance would be $
. (Round to 2 decimal places.)

Answer 1

P = $381.39 * ((1 - (1 + 0.01825)^-36) / 0.01825)

P = $12,685.29

Therefore, the unpaid balance immediately after the ninth payment would be:

$10,000.00 - $12,685.29 = -$2,685.29

Since the unpaid balance cannot be negative, this means that the entire loan would be paid off after the ninth payment. Therefore, the unpaid balance would be $0.00.