SOLUTION: A debt of $5000 is to be amortized with 12 equal semiannual payments. If the interest rate is 12%, compounded semiannually, what is the size of each payment? (Round your answer to

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Question 1088030: A debt of $5000 is to be amortized with 12 equal semiannual payments. If the interest rate is 12%, compounded semiannually, what is the size of each payment? (Round your answer to the nearest cent.)
How much $ ?
Answer by ankor@dixie-net.com(22740) About Me  (Show Source):
You can put this solution on YOUR website!
A debt of $5000 is to be amortized with 12 equal semiannual payments.
If the interest rate is 12%, compounded semiannually, what is the size of each payment? (Round your answer to the nearest cent.)
:
The amortization formula: A+=+P%28r%28%281%2Br%29%5En%29%2F%28%281%2Br%29%5En-1%29%29
P = 5000
r = .06; (.12/2; compounded twice a year)
n = 12 no. of payments
:
A+=+5000%28.06%28%281%2B.06%29%5E12%29%2F%28%281%2B.06%29%5E12-1%29%29
I'll let you do the math here with your calc
I got a payment of
A = $596.39