A loan of $36,000 is to be repaid by quarterly payments over 10 years at j₄ = 8%.The first payment is $1000,the 2^nd payment is $1020,the 3^rd payment is $1040 and so on.The principal repaid in the first payment is $280.What is the outstanding balance of the loan after the 2^nd payment?

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The outstanding balance after the second payment can be calculated by considering the initial loan amount, the payments made, and the interest accrued. After the first payment of $1000, with $280 going towards the principal, the balance becomes $36,000 - $280 = $35,720. Interest for one quarter at 8% annual rate is 2% per quarter, so the interest on the remaining balance is $35,720 * 0.02 = $714.40. Therefore, the new balance before the second payment is $35,720 + $714.40 = $36,434.40. The second payment is $1020, but we need to calculate how much of this goes towards the principal. Since the interest is the same as the first quarter ($714.40), the principal repaid in the second payment is $1020 - $714.40 = $305.60. Thus, the outstanding balance after the second payment is $36,434.40 - $305.60 = $35,414.40.

A Loan of $36,000 Is to Be Repaid by Quarterly