1. **Problem statement:** A person borrows 18000 with repayment in 4 equal principal installments and pays interest every 3 months at 8% annual rate. 2. **Formula and rules:** - Interest for each quarter = Principal remaining \times quarterly interest rate. - Quarterly interest rate = $\frac{8\%}{4} = 2\% = 0.02$. - Principal installment = $\frac{18000}{4} = 4500$. 3. **Calculate interest and payments for each quarter:** - Quarter 1: Principal remaining = 18000 Interest = $18000 \times 0.02 = 360$ Payment = Principal installment + Interest = $4500 + 360 = 4860$ - Quarter 2: Principal remaining = $18000 - 4500 = 13500$ Interest = $13500 \times 0.02 = 270$ Payment = $4500 + 270 = 4770$ - Quarter 3: Principal remaining = $13500 - 4500 = 9000$ Interest = $9000 \times 0.02 = 180$ Payment = $4500 + 180 = 4680$ - Quarter 4: Principal remaining = $9000 - 4500 = 4500$ Interest = $4500 \times 0.02 = 90$ Payment = $4500 + 90 = 4590$ 4. **Summary table:** | Quarter | Principal Remaining | Interest | Payment | |---------|---------------------|----------|---------| | 1 | 18000 | 360 | 4860 | | 2 | 13500 | 270 | 4770 | | 3 | 9000 | 180 | 4680 | | 4 | 4500 | 90 | 4590 | This table shows the loan amortization with equal principal payments and quarterly interest.