1. Calculating Loan Repayments

2. Loan Repayment PV = R ∙( 1+ 1+𝑖 −𝑛 𝑖 )
PV = Principal Value i = interest rate n = number of payments
When you pay back a loan, you are charged with the same monthly payment for the term of the loan. However, with each payment you make on the loan the interest based on the loan is from a smaller and smaller principal remaining on it.

3. Ex. You take out a loan for $16,500 at 2
Ex. You take out a loan for $16,500 at 2.9% annual interest for 4 years. What are the monthly payments? What is the total payback on the loan? What is the interest paid on the loan?
PV = $16500 i = n = 4 ∙12 R = monthly payment
16500 = R ∙( − )
$ = R monthly payment
* 48 =
$17, = total payback on the loan
– = 995
$ = total interest paid on the loan