Annuity at nominal rate

Question

Consider a $30$-year loan of $200,000$ that can be repaid with $A$ per month at a nominal rate of $10$%. Calculate $A$.

Effective monthly interest rate is given as $\frac{0.1}{12}$

Present value of loan is given as

$200 000=A [\frac{1-(\frac{0.1}{12})^{-30X12}}{\frac{0.1}{12}}]$

I am having math error here.

See https://en.wikipedia.org/wiki/Mortgage_calculator#Monthly_payment_formula — cgiovanardi, Sep 03 '16 at 21:16

score 0 · Answer 1 · answered Sep 04 '16 at 06:02

0

$A=\frac{200,000(\frac{0.1}{12}) (1+\frac{0.1}{12})^{360}}{(1+\frac{0.1}{12})^{360}-1}=1755.143$

answered Sep 04 '16 at 06:02

Tosh

1 Answers1