Second year will represent repayment of principal

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Reference no: EM131444259

1. Your company is planning to borrow $1,000,000 on a 5-year, 15%, annual payment, fully amortized term loan. What fraction of the payment made at the end of the second year will represent repayment of principal?

a) 44.1%

b) 48.0%

c) 51.8%

d) 54.5%

e) 57.2%

2. If you deposit $1,000 every year (starting one year from today) in your bank account and earn 16% on your deposit balance, how much money will you have at the end of four years, assuming that you will make four $1,000 payments?

a) $4,000

b) $5,067

c) $5,877

d) $8,000

e) $8,207

Reference no: EM131444259

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