SOLUTION: A loan is $6000, with payment and interest (6%) to be paid in 3 equal yearly payments. Determine payment. Non-homework. Thanks.

Question 1076615: A loan is $6000, with payment and interest (6%) to be paid in 3 equal yearly payments. Determine payment.
Non-homework. Thanks.
Answer by jorel1380(3719) (Show Source): You can put this solution on YOUR website!
The formula for paying back a loan over time is:
P=L((c(1+c)^n))/((1+c)^n -1)
Where P are the payments, L is the amount of the loan, c is the interest rate, and n is the number of total payments. So:
P=6000(.06(1.06)^3/(1.06)^3 -1
P=2244.6588
Payments are $2244.6588 a year for 3 years. ☺☺☺☺
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