jeffery wei received a 6 year non subsidized student loan of 30000 at an annual interest rate of 5.2%. what are jeffery’s monthly loan payments for this loan after he graduates in 4 years
If the loan interest rate remains at i=5.2%/12 per month throughout the six years, then amount owing after 4 years, or the future value [tex]F=30000(1+i)^(4*12)[/tex] [tex]==30000(1+0.052/12)^(48)[/tex] [tex]=36919.80[/tex] to the nearest cent
Monthly payment, A, required to repay the loan in two years (24 months) [tex]\frac{P(i*(1+i)^n)}{(1+i)^n-1}[/tex] [tex]=\frac{36919.80(.052/12*(1+.052/12)^{24})}{(1+.052/12)^{24}-1}[/tex] [tex]=1623.03[/tex] to the nearest cent.
Answer: Jeffrey will have to repay $1623.03 monthly during the last two years of his loan to owe nothing at the end of the 6 years loan period.
