Rand Alqam/ 21910909

Q1 Ayman borrowed $150000 from Arab Bank at 10%, to be repaid yearly over 10 years.
1. Build an amortization table.
2. what is the total interest Paid
3. Should Ayman repay the loan monthly or yearly. Explain
4. Suppose that Ayman decide to repay the loan over 15 years yearly payment.
A. what would be each periodic payment
B. why should or shouldn't increase the period?

loan 150000
Time 10 Year
Rate 10% Yearly
Yearly Payment $24,411.81

Monthly Rate 0.00797414042890376

What is the total interest Paid

Total Interest $94,118.1

3 Should Ayman repay the loan monthly or yearly. Explain

Yearly Repayments $24,411.81 within (10Y)

Monthly Repayments $1,946.63 within (120mth)

as a Monthly payments he saves $10,522.26.

so he should pay the loan monthly instead of yearly.

4 Suppose that Ayman decide to repay the loan over 15 years yearly paym
A. what would be each periodic payment
 loan 150000
Time 15 Year
Rate 10% Yearly
Yearly Payment $19,721.07

B. why should or shouldn't increase the period?

Yearly Repayments within (10y) $24,411.81

Yearly Repayments within (15y) $19,721.07

Repayment over 15 years instead of 10 years. will cost Ayman $51,697.91 more. so he
should pay off the loan over 10 years. without any increase in time
0 years.

Build an amortization table.

1
Year Per Payment yearly Interest Principal Repayment Outstanding Principal
0 $94,118.1 150000
1 $24,411.81 15000.0 $9,411.81 $140,588.19
2 $24,411.81 14058.8 $10,352.99 $130,235.20
3 $24,411.81 13023.5 $11,388.29 $118,846.91
4 $24,411.81 11884.7 $12,527.12 $106,319.79
5 $24,411.81 10632.0 $13,779.83 $92,539.96
6 $24,411.81 9254.0 $15,157.81 $77,382.15
7 $24,411.81 7738.2 $16,673.59 $60,708.56
8 $24,411.81 6070.9 $18,340.95 $42,367.60
9 $24,411.81 4236.8 $20,175.05 $22,192.55
10 $24,411.81 2219.3 $22,192.55 $0.00

yearly. Explain

$244,118.09

$233,595.83
$10,522.26

an over 15 years yearly payment.

ayment
the period?

$244,118.09

$295,816.00
$51,697.91

man $51,697.91 more. so he

se in time
 CF
-150000
$24,411.81
$24,411.81
$24,411.81
$24,411.81
$24,411.81
$24,411.81
$24,411.81
$24,411.81
$24,411.81
$24,411.81
10%