Example #3: Solving for the present value and interest of a loan with a single payment (BE)
Annette wants a home improvement loan to renovate her kitchen. Her bank will charge her
3.6%, compounded quarterly. She already has a 10-year GIC that wi mature in 5 years. When
her GIC reaches maturity. Annette wants to use the money to repay home improvement
loan with one payment. She wants the amount of the payment to be no more than $20 000.
a) How much can she borrow?
b) How much interest will she pay?
Sehuby hed and then check using the TVM Solver