At the beginning of January 2010, Robert borrowed $\$200\;000$ from a bank that charges $0.4\%$

Question

At the beginning of January 2010, Robert borrowed $\$200\;000$ from a bank that charges $0.4\%$ interest at the end of every month. Robert pays back $\$1500$ at the beginning of every month, starting from February 2010. Show that the amount Robert still owes the bank at the end of $n$ months is $376500-175000{{(1.004)}^{n}}.$[3]

How much did he pay on his last instalment?[3]

Accepted Answer

(i) $376500-175000(1.004)^n$ (ii) $\$1373.97$, paid at the beginning of the $192^\mathrm{nd}$ month

2013 VJC P1 Q3

2013 VJC P1 Q3

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