1 Answer

Jaffa · Answer 1 · 2023-07-17T10:52:07+0000

Amortization is the process of paying off debt with regular payments made over time.

Given that

$A\text{ =P x}((r)/(n)(1+(r)/(n))^(nt))/((1+(r)/(n))^(nt)-1)$

where P = $20,000

r= 5% = 0.05

n = 4 (since it is compounded quarterly)

t = 11/12 (Since it is 11 quaterly payment)

$\begin{gathered} \text{Therefore n x t = 4 x}(11)/(12)\text{ =}(11)/(3) \\ \end{gathered}$

Also,

$(r)/(n)=(0.05)/(4)=\text{ 0.0125}$

Substituting these values

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