What is the total amount repayments at the end of the loan

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Samu wants to start up a tax agency business. He wishes to take a loan of $20,000 to set-up his office. The bank agrees to give him the loan at 3% above the August 2020 average lending rate published in the RBF Economic Review. There is also a one-off establishment fee of 1% of the loan amount. Further there is an administrative fee of $20 per month. Interest is calculated monthly on the initial loan amount.

Assuming the loan is to be repaid monthly over 18 months.

Problem a) What is interest for the loan period?

Problem b) What is the total amount repayments at the end of the loan?

Problem c) What will be the monthly repayment?

Reference no: EM132942332

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