2. A home loan package offers a fixed 2.4% p.a. compounded monthly for the first 5 years, and after 5 years the interest rate increases to 4.2% p.a. compounded monthly. A loan of $300,000 is taken out with level repayments of $1,986.28 per month at the end of each month for the life of the loan. Determine how long it takes to pay off this loan. (a) Suppose the loan had been at a fixed interest rate of 2.4% p.a. compounded monthly for the lifetime of the loan. Calculate how long it would take to pay off the loan. Give your answer rounded to the nearest month. (b) Use your answer to (a) to calculate the unpaid balance of the loan after 5 years. Give your answer rounded to the nearest cent. (c) Use your answer to (b) to calculate how long it will take to pay off the remainder of the loan at the higher interest rate. Give your answer rounded to the nearest month.

2. A home loan package offers a fixed 2.4% p.a. compounded monthly for the first 5 years, and after 5 years the interest rate increases to 4.2% p.a. compounded monthly. A loan of $300,000 is taken out with level repayments of $1,986.28 per month at the end of each month for the life of the loan. Determine how long it takes to pay off this loan. (a) Suppose the loan had been at a fixed interest rate of 2.4% p.a. compounded monthly for the lifetime of the loan. Calculate how long it would take to pay off the loan. Give your answer rounded to the nearest month. (b) Use your answer to (a) to calculate the unpaid balance of the loan after 5 years. Give your answer rounded to the nearest cent. (c) Use your answer to (b) to calculate how long it will take to pay off the remainder of the loan at the higher interest rate. Give your answer rounded to the nearest month.

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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Consider a home mortgage of $125,000 at a fixed APR of 4.5% for 25 years. a. Calculate the monthly payment. b. Determine the total amount paid over the term of the loan. c. Of the total amount paid, what percentage is paid toward the principal and what percentage is paid for interest. ..... a. The monthly payment is $ (Do not round until the final answer. Then round to the nearest cent as needed.)
Problem: Please answer the following questions regarding a $300,000 Mortgage Loan with monthly amortization over 30 years and an annual interest rate of 6%. What is the loan payment for a (30 year loan (360 monthly payments) of $300,000 at 6%? Question Answer What is the monthly payment amount? Loan Monthly Payment: How much interest and how much is principle on the first payment? Interest: Principle: How much interest and how much is principle on the second payment? Interest: Principle: If after the second payment an addition $10,000 was paid on principle. How much would the interest be on the third payment? Interest:
Assume you plan to borrow $400,000 from your bank to buy a home. The bank offers: a 5-year fixed rate of 6.05 %, compounded monthly. a 3-year fixed rate of 5.75 %, compounded monthly. If you choose to repay the borrowing in equal installments monthly over a 20 years, what would be the difference between your monthly payments at the two different APRs? a. $68.94 b. $154.58 c. $26.98 d. $89.32
Consider a 30-year home mortgage of $100,000 at 6% per year. What is the monthly payment? Use Theorem 1 as attached to make an amortization schedule of the first 6 months: Month (k) Principal P(k) Interest I(k) Balance due B(k) 1 2 3 4 5 6 where P(k) is the amount paid to the principal in the k’th payment, I(k) is the amount paid to interest in the k’th payment, B(k) is the balance due after the k’th payment.
1
Charlotte's Clothing issued a 8 percent bond with a maturity date of 18 years. Six years have passed and the bond is selling for $865. Assume that the bond pays interest annually. What is the current yield? Round your answer to two decimal places. % What is the yield to maturity? Use Appendix B and Appendix D to answer the question. Round your answer to the nearest whole number. % If four years later the yield to maturity is 10 percent, what will be the price of the bond? Use Appendix B and Appendix D to answer the question. Round your answer to the nearest dollar. $
9. Eddy obtained a $320,000 loan at 3.8% compounded semi-annually. What monthly payments will repay the loan in 25 years? How much interest will Eddy pay over the life of the loan. please solve it using PMT formula please solve it using PMT formula
5. BDO offers you a $30,000, seven-year term loan at 9% annual interest. What will your annual loan payment be?
A $14,000 loan at 6% interest rate is paid over 4 years. Draw up the loan repayment table if the repayment follows the constant annuity method. solve it correctly please. I will rate accordingly. Show wo
Consider a 4-year amortizing loan. You borrow $2,400 initially and repay it in four equal annual year-end payments. a. If the interest rate is 10%, what is the annual payment? Note: Do not round intermediate calculations. Round your answer to 2 decimal places. Annual payment $ ✓Answer is complete and correct. Time b. Prepare an amortization schedule. Note: Do not round intermediate calculations. Round your answers to 2 decimal places. Leave no cells blank - be certain to enter "0" wherever required. 1 2 3 4 Loan Balance (S) 2,400.00 2,400.00 757.13 1,882.87 x 1,314.03 688 Answer is complete but not entirely correct. Year-End Interest Due on Loan Balance (5) 240.00 188.29 131.40 68.83 Total Year- End Payment ($) 10 757.13 757.13 757.13 757.13 Amortization of Loan (S) 0 517.13 568.84 625.73 688.30
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