Loan Schedule - Q1

A loan is repayable by annual instalments paid in arrear for 20 years. The first instalment is £4,650 and each subsequent instalment is £150 greater than the previous instalment.

Calculate the following, using an interest rate of 9% per annum effective:

(i) the amount of the original loan [3]

(ii) the capital repayment in the tenth instalment [4]

(iii) the interest element in the last instalment [2]

(iv) the total interest paid over the whole 20 years. [2]

[Total 11]

Answer