Showing the student's calculations (using the variables from a financial calculator) and answer for each of the 3 parts required in the problem. Make sure answers are clearly identified.
Loan amortization schedule Joan messineo borrowed 15,000 at 14% annual rate of interest to be repaid over 3 years. The loan is amortizd into three equal, annual, end of year payments.
a. calculate the annual end of year loan payment
b. prepare a loan amortization schedule showing the interest and principal break down of each of the three laon payments.
c. explain why the interest portion of each payment declines with the passage of time.
B-1.) Based on the loan amortization schedule, what conclusion can be made about the principal repayments and interest payments from this example?
c-1.) The loan amortization schedule in this problem is to satisfy a 3 year loan with annual payments. If you are considering selecting a mortgage of either a 15 year mortgage or a 30 year mortgage, what should be taken into consideration to help you choose between either loan maturities? What adjustments would have to be made to this problem's set up to accommodate a typical mortgage example?