Reducing balance loans are calculated on the balance owing and not the initial amount borrowed. As payments are made, the balance owing is reduced and hence the interest charged is reduced. The following videos highlight how recursion in reducing balance loans work in QCE General Maths, and how to graph them.
What is a Reducing Balance Loan?
This video explains the concept of a reducing balance loan.
QCE Lesson Examples – Recursion and Reducing Balance Loans
During quarantine, a few teachers uploaded their class videos online. They are quite long but are worth the watch if you need to consolidate the information further.
Part 1
Part 2
Graphing a Reducing Balance Loan
The following video explains how to graph a reducing balance loan.
Want to learn more? Check out more of our QCE General Maths resources here!
