Bank Loans Practice Quiz

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An important application of -Select- loans. Each loan payment consists of interest and repayment of principal. This breakdown is often developed in an amortization schedule. Interest is -Select- v in the first interest involves amortized loans. Some common types of amortized loans are automobile loans, home mortgage loans, and business period and -Select- over the life of the loan, while the principal repayment is | -Select- v in the first period and it | -Select- thereafter. Quantitative Problem: You need $11,000 to purchase a used car. Your wealthy uncle is willing to lend you the money as an amortized loan. He would like you to make annual payments for 5 years, with the first payment to be made one year from today. He requires a 8% annual return. a. What will be your annual loan payments? Do not round intermediate calculations. Round your answer to the nearest cent. $ b. How much of your first payment will be applied to interest and to principal repayment? Do not round intermediate…

4.-Among the following options are the main characteristics (purpose of the credit, term, interest collection and guarantees) of the Direct Loan. Choose the 4 correct answers. A) To finance the purchase of machinery B) Long term C) With real guarantees. D) With interest charged at maturity E) 30, 60, 90 days F) With interest collected in advance G) To finance working capital H) Without guarantees   (is a classroom exercise)

4.-Among the following options are the main characteristics (purpose of the credit, term, interest collection and guarantees) of the Direct Loan. Choose the 4 correct answers. A) To finance the purchase of machinery B) Long term C) With real guarantees. D) With interest charged at maturity E) 30, 60, 90 days F) With interest collected in advance G) To finance working capital H) Without guarantees

7. Time Value of Money: Amortized Loans An important application of -Select- interest involves amortized loans. Some common types of amortized loans are automobile loans, home mortgage loans, and business loans. Each loan payment consists of interest and repayment of principal. This breakdown is often developed in an amortization schedule. Interest is -Select- in the first period and -Select- over the life of the loan, while the principal repayment is -Select- in the first period and it -Select- thereafter. Quantitative Problem: You need $15,000 to purchase a used car. Your wealthy uncle is willing to lend you the money as an amortized loan. He would like you to make annual payments for 5 years, with the first payment to be made one year from today. He requires a 6% annual return. a. What will be your annual loan payments? Do not round intermediate calculations. Round your answer to the nearest cent. $ b. How much of your first payment will be applied to interest and to principal…

The principal amount of a loan is the Blank______. Multiple choice question. amount that has been repaid original loan amount total interest owed total number of payments made

Simple interest refers to interest on a loan computed as a percentage of the loan amount. Compound interest refers to the process of, investing your money. saving your money. C a loan amortization. a loan computed at a nominal interest rate. E earning interest on interest.

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Prove the loan payment​ formula, shown below.   PMT=Prn1−1+rn−nt       Question content area bottom Part 1 Manipulate the formula shown below to prove the loan payment formula. The left side of the equation is the future value of the principal amount and the right side is the future value of the loan payments.​ First, solve the equation for PMT.   P1+rnnt  = PMT1+rnnt−1rn

Business Math Worksheet 8.2: Installment loans-Amount Financed Name Background: An installment loan is repaid in several equal payments over a specified period of time. Usually, you make a down payment to cover a portion of the cash price of the item. The amount you finance is the portion of the cash price that you owe after making the down payment. Amount Financed = Cash Price - Down Payment Down Payment = Cash Price x Percent 1. Flora Quinton is buying a new air compressor for her auto repair shop. It sells for $1,299. She makes a down payment of $199 and finances the remainder. How much does she finance? 2. Beatriz Ruiz is buying new office furniture. It sells for a cash price of $2,358.60. The down payment is $200.00. What is the amount financed 3. An office remodeling project costs $15,880. If you pay $3,680 towards the project, how much do you finance?

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Which of the following is true when the mortgage loan is an amortizing loan? a. At the beginning of the term of the loan the largest part of the payment is a paydown of principal, but a payments progress a rising portion is applied to interest payments. b. Interest payments and paydown of principal remain constant during the loan. c. At the beginning of the term of the loan the largest part of the payment is interest, but a payments progress a rising portion is applied to the paydown of principal. d. Paydown of principal occurs at the end of the loan. e. None of the above.

2.  Help me selecting the right answer. Thank you

6.-If a bank client requests a loan for the acquisition of real estate, what type of loan is he/she requesting? A) Refinance loan B) Entitlement loan or avío loan C) Mortgage loan D) Unsecured loan

What is the right answer from A to D? Please help me