The Hills purchased 268 acres of good farmland at $4,850 per acre. They paid 32 percent down and were able to obtain a loan at the rate of 5.2 percent over a 20-year period. They will repay the principal in equal annual payments and the interest in semiannual payments on the annual balance of the principal.
a. What was the amount of the down payment?
b. What was the amount of the loan?
c. What is the semiannual interest payment the first year?
d. What is the principal at the end of the second year?
a. $415,936
b. $883,864
c. $22,980.46
d. $795,477.60
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