TITLE:
Multiple Contracts: The Case of the German System of Amortization in Compound Interest
AUTHORS:
Clovis de Faro, Gerson Lachtermacher
KEYWORDS:
Amortization Systems, Multiple Contracts Scheme, Compound Interest Capitalization, German Amortization System, French Amortization System
JOURNAL NAME:
Theoretical Economics Letters,
Vol.14 No.5,
October
31,
2024
ABSTRACT: In what appears to be a pioneering contribution of De-Losso et al., the multiple contracts scheme has been implemented in several amortization methods, such as constant installments, constant amortization and American. This paper will address the multiple contracts schema to the German amortization method, in compound capitalization. Since this method has the payments of interest at the beginning of each period, some adaptations were required in the De-Losso proposition. Additionally, a comparison with the French system is also presented.