A debt of 7000 is to be amortized with 6 equal semiannual pa

A debt of $7000 is to be amortized with 6 equal semiannual payments. If the interest rate is 8%, compounded semiannually, what is the size of each payment? (Round your answer to the nearest cent.)

Solution

Principal = $7000

rate= 8%

Time= 3 years = 6 semesters

Amount = 7000(1+(8/2*100))^6

=$ 8857.233

This amount is to be paid in 6 payments therby each payment = 8857.233/6 i.e. = $1476.25