QUESTION 1: (10 marks) (A) Miss Tan had just secured a $20,000.00 bank loan to...
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QUESTION 1: (10 marks) (A) Miss Tan had just secured a $20,000.00 bank loan to set up a small business that is to be repaid in three equal annual end of year payments. The interest rate on the loan is 11% per annum, interest calculated on a yearly reducing balance. As part of financial planning, she wants to know the annual interest payable attributable to the loan. Prepare an amortization schedule for the loan and indicate how much is the annual interest payable on the loan? (7 marks) (B) At retirement, you would like to have $1,500,000. You would like to save for retirement by setting aside an equal sum from every monthly paycheck you receive for the next 35 years. You think you can earn an interest rate of 12%, compounded monthly. How much do you need to save from every paycheck
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