Answer:
Semiannual payment = $ 1391.37
Total payment = $ 8348.22
Interest paid = $ 848.22
Step-by-step explanation:
Since, the semiannual payment formula of a loan,
[tex]P=\frac{PV(\frac{r}{2})}{1-(1+\frac{r}{2})^{-n}}[/tex]
Where,
PV = present value of the loan,
n = number of semiannual payments,
r = annual rate,
Here, PV = 7500, r = 6.3% =0.063, n = 6,
By substituting the value,
The semiannual payment would be,
[tex]P=\frac{7500(\frac{0.063}{2})}{1-(1+\frac{0.063}{2})^{-6}}[/tex]
[tex]\approx \$ 1391.37[/tex]
Also, total payment = semiannual payment × total semiannual periods
= 1391.37 × 6
= $ 8348.22,
Also, the interest paid = total payment - present value
= 8348.22 - 7500
= $ 848.22
