Problem:
Suppose you take out a loan of $10,000, repayable by five equal annual installments. The interest rate is 10% per year.
(a) How much do you need to repay per year to the nearest cent if payments are due:
(i) at the beginning of each year (ii) at the end of each year?
(b) Which loan in part (a) is preferable, (i) or (ii)? Explain your answer.
Additional Information:
This question belongs to the Finance and it describes about computation of repayment of loan at the beginning and end of each year and whether or not it is preferable.