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Aerotron Electronics has just bought a used delivery truck for $15,000. The small business paid $1,000...

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Finance

Aerotron Electronics has just bought a used delivery truck for$15,000. The small business paid $1,000 down and financed the rest,with the agreement to pay nothing for the entire first year andthen to pay $546.83 at the end of each month over years 2, 3, and 4(first payment is in 13th month).

a) what nominal interest rate is Aerotron paying the loan?(please try to show me with goal seek and Excel)

b) what effective interest rate are they paying?

c) how much of the 14th month's payment is interest? how much isprincipal?

d) how much of the 18th month's payment is interest? how much isprincipal?

e) how much of the 22nd month's payment is interest? how much isprincipal?

Answer & Explanation Solved by verified expert
3.7 Ratings (502 Votes)
a Let i12 be the nominal interest rate compounded monthly According to the information given in the question 14000506831 i12 12a36 where a36 is annuity function    See Answer
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