Neco 2019 Commerce Question 9
Practice objective / multiple choice question 9 from the 2019 Neco Commerce examination.
An individual borrows \(500\,000\) naira from a bank. The nominal annual interest rate is 12 % convertible semi‑annually, and the loan is to be repaid in equal annual installments over 3 years, with the first payment due at the end of the first year. The bank also charges a processing fee equal to 2 % of the loan amount, payable immediately, and adds a yearly service charge of \(5\,000\) naira to each installment. Calculate the amount of each annual installment (including the service charge) that the borrower must pay. Give your answer in naira, rounded to the nearest naira.
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About This Question
This is Neco 2019 Commerce Question 9. It is one of the objective questions from the 2019 Neco Commerce examination.
Difficulty level: Medium .
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