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July 7th, 2011, 09:09 PM   #1
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Loan outstanding to number of payments made

From the following sets of numbers derive an equation that relates the amount of a loan outstanding to the number of payments made:

Loan outstanding 5000 / 4000 / 3000 / 2000 / 1000 / 0

Payments made 4 / 8 / 12 / 16 / 20 / 24

What is the best way to approach this?
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July 7th, 2011, 09:18 PM   #2
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Re: Loan outstanding to number of payments made

One way is to use the point-slope formula since both quantities change linearly:

Let O be the outstanding amount and n be the number of payments made:

We can use the point (O,n) = (0,24) and the slope thus:



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July 7th, 2011, 09:46 PM   #3
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Re: Loan outstanding to number of payments made

Thanks, I am starting to work with slopes and rate of change now so that is very helpful!
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July 7th, 2011, 09:50 PM   #4
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Re: Loan outstanding to number of payments made

Cool! I was hoping that was why this question was given to you!
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