An $18,000 loan at 12% interest compounded annually is to be repaid in equal yearly installments. The percentages of each payment going toward interest versus principal changes each year, as the outstanding balance declines and less interest is charged, though the total payment remains the same. As the balance decreases over time, the portion of each payment allocated to interest decreases and the portion allocated to principal increases.

1. Complete an amortization schedule for a $18 , 000 loan to be repaid in equal instaliments at the
end of each of the years. The interest rate is 12% compounded annually. If an amount is zero,
enter " 0 ". Do not round intermediate calculations. Round your answers to the nearest cent. b.
What percentage of the payment represents interest and what percentage represents principal for
each of the 3 yt not round intermediate calculations; Round your answers to two decimal places.
wny do these percentages change over time? 1. These percentiges change over time because even
though the total payment is constant the amount of interesi! each year is declining as the
remaining or outstanding balance declines. II. These percentages change over time because even
though the total payment is constant the amount of interes each year is increasing as the
remaining or outstanding balance declines. III. These percentages change over time because even
though the total payment is constant the amount of interest each year is declining as the
remaining or outstanding balance increases. IV. These percentages change over time because
even though the total payment is constant the amount of interes! each year is increasing as the
remaining or outstanding balance increases. V. These percentages do not change over time;
interest and principal are each a constant percentage of the total