Loan Amount = $12,000 Quarterly Payments = $290 To know the Outstanding Balance just before the 26th payment, we first calculate the Outstanding Balance after 25th payment  - Calculating the Outstanding Balance after 25th payment:- Outstanding Balance =P**(1+r)^(n)-C**([(1+r)^(n)-1])/(r) Where, C= Periodic Payments = $290 r = Periodic Interest rate = 4%/4 = 1% n= no of periods = 25 P = Loan AMount = $12,000 Outstanding Balance =12,000**(1+0.01)^(25)-290**([(1+0.01)^(25)-1])/(0.01) Outstanding Balance =12 ... See the full answer