The Summer Breeze Hotel Borrowed $100,000 from the Meadowlands Bank

Multiple Choice

The Summer Breeze Hotel borrowed $100,000 from the Meadowlands Bank to pay for a new air conditioning system. The loan is for a period of 5 years at an interest rate of 10% and requires 5 equal end-of-year payments that include both principal and interest on the outstanding balance. What will be the outstanding balance after the third payment?

A) $60,000
B) $20,865
C) $45,788
D) $50,866