and Amortization Formulas Ordinary Annuity Formula John Smith recently set up a taxdeferred annuity to save for his retirement He arranged to have 50 taken out of each of his biweekly checks it will earn ID: 422263
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Slide1
Annuities
and
AmortizationSlide2
Formulas
Ordinary Annuity FormulaSlide3
John Smith
recently set up a tax-deferred annuity to save for his retirement. He arranged to have $50 taken out of each of his biweekly checks; it will earn
annual interest. He just had his thirtieth birthday, and his ordinary annuity comes to term when he is sixty-five. Find the following:
the future value of the account
John’s
total contribution to the account. the total interest Slide4
Formulas
Simple Interest Amortized Loan FormulaSlide5
Formulas
Unpaid Balance Formula
T
is the number of years from the beginning of the loan to the presentSlide6
Shirley
bought
a house for $187,600. She put 20% down and obtained a simple interest amortized loan
for
the balance at for 30 years. Find her monthly payment.Find the total interest.
Prepare an amortization schedule for the first two months of the loan.Slide7
Shirley
bought
a house for $187,600. She put 20% down and obtained a simple interest amortized loan
for
the balance at for 30 years. 20 years have passed and Shirley wants to pay off the balance on her house. If there is no pre-payment penalty, what will it cost for Shirley to pay off the unpaid balance of her home loan?