Final answer:
The question asks for the calculation of a monthly payment for a loan with an interest rate, compounded monthly, and amortized over 18 months, as well as constructing an amortization schedule for this loan.
Step-by-step explanation:
The question involves calculating the monthly payment for a loan of RM 1000 with a 12% annual interest rate, compounded monthly, that is to be amortized over 18 months. To calculate the monthly payment, we use the formula for the monthly payment of an amortizing loan, which takes into account the principal amount, monthly interest rate, and number of payments. The formula for the monthly payment (M) is:
M = P * (i / (1 - (1 + i)^(-n)))
where P is the principal amount (RM 1000), i is the monthly interest rate (0.12/12), and n is the total number of payments (18).
Amortization schedule construction involves listing each monthly payment and breaking it down into the amount that goes towards paying the interest and the amount that goes towards reducing the principal.