MATH 3618- More Annuities & Loan Amortization

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1

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Define:

OB_t,K_{t ,}P_t, i_t

OB_t, = Outstanding Balance

K_t = Payment size @ time t

P_t,= Principal

i_t = Interest

2

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L (initial loan payment) = ___

L (initial loan payment) = OB₀

3

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K_t= _____ + _____

K_t= P_t+ i_t

4

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i_t= _____ ⋅ _____

i_t= i⋅ OB_t-1

5

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OB_t = _____ - _____

OB_t = OB_t-1 - P_t

6

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OB_t = _____ ⋅ _____ - _____

OB_t = OB_t-1 ⋅ (1+i) - K_t