Question 1: An amortization
Ahmad borrowed $450000.00 at 3% compounded semi-annually for ten years to buy an apartment. Equal payments are made at the end of every six months.
a) Determine the size of the semi-annual payments.
b) Prepare an amortization schedule showing the details of the first two payments and the totals of all payments.
c) Use Excel to create an Amortization Schedule showing the details of all payments and the totals of all payments. Print and attach your Excel worksheet.
Question 2: A sinking fund
A sinking fund amounting to $450000.00 is to be created by making deposits at the end of every six months for ten years. Interest earned by the fund is 3% compounded semi-annually.
a) Determine the size of the semi-annual deposits.
b) Prepare a sinking fund schedule showing the details of the first three deposits and the totals of all payments.
c) Use Excel to create a sinking fund schedule showing the details of all payments and the totals of all payments. Print and attach your worksheet.