Question - On December 31, Beth Klemkosky bought a yacht for $70,000. She paid $12,000 down and agreed to pay the balance in 6 equal annual installments that include both the principal and 11 percent interest on the declining balance. How big will the annual payments be?
a. On December 31, Beth Klemkosky bought a yacht for $70,000 and paid $12,000 down, how much does she need to borrow to purchase the yacht?
b. If Beth agrees to pay the loan plus 11 percent compound interest on the unpaid balance over the next 6 years in 6 equal end-of-year payments, what will those equal payments be?