3. Ruth Brown wants to borrow $2,600 for 90 days to pay her real estate tax. State Savings and Loan charges7.25% ordinary interest while Security Bank charges 7.5% exact interest3a. What is the maturity value of each loan?3b. Where should they borrow the money?4. You have a chance to lend $6,500 at 5.25% interest for 95 days4a. If you charge ordinary interest, how much will you earn?4b. If you charge exact interest, how much will you earn?4c. If you were borrowing the money, would you prefer to payordinary interest or exact interest? Why?

The amount of money earned that is not used for immediate expenses is saved. In other words, it…

Answered: 3. Ruth Brown wants to borrow $2,600…

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter16: Working Capital Policy And Short-term Financing

Section: Chapter Questions

Problem 14P

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Today, you borrowed $6,200 on your credit card to purchase some furniture. The interest rate is 14.9 percent. How long will it take you to pay off this debt assuming that you do not charge anything else and make regular monthly payments of $120? Group of answer choices 6.93 years 7.23 years 6.40 years 7.31 years 5.87 years
You want to buy a $280000 home. You plan to pay $56000 as a down payment, and take out a 15 year loan at 3.5% interest for the rest. a) What is the amount of the payment? b) If the bank charges 3 points on the loan, what is the amount charged for points? c) If the bank charges 3 points on the loan, what is the true interest rate?
2. If a borrower tells you that he needs a loan for 6 years and 3 months and will pay you an annual rate of 5 1/2% for the loan, but will give you only $141.02 back at the end of the loan term , you should only loan him $100 today. What amount does the formula P = F/(See image) indicate that you need to place in a savings account today in order to have $150,000 by the time your daughter goes off to college in 18 years and 6 months if the account earns 3% annually?
You want to buy a $200000 home. You plan to pay $20000 as a down payment, and take out a 20 year loan at 5.25% interest for the rest. a) What is the amount of the payment? $ b) If the bank charges 1.5 points on the loan, what is the amount charged for points? $ c) If the bank charges 1.5 points on the loan, what is the true interest rate? $ Question Help: D Video Submit Question
A friend asks to borrow 455 form you and in return will pay you $58 in one year. If your bank is offering a 6% interest rate on deposits and loans: a) how much would you have in one year if you depostied the $55 instead? b) how much money could you borrow today if you pay the bank $58 in one year?
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12. A bank offers a 272- day discounted loan at a simple discount rate of 12%. (a) How much money would a borrower receive if she asked for a $5,000 loan? (b) What size of the loan should the borrower ask for in order to actually receive $5,000? (c) What is the equivalent simple interest that is being charged on the loan?
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your bank also requires that the monthly mortgage payments include properety tax and homeowners insurance payments. if the property tax is 1,710 per year and the properety insurance is 1458 per year for (PITI) what is the total monthly payment in $?
A friend asks to borrow $53.00 from you and in return will pay you $56.00 in one year. If your bank is offering a 5.7% interest rate on deposits and loans: a. How much would you have in one year if you deposited the $53.00 instead? b. How much money could you borrow today if you pay the bank $56.00 in one year? c. Should you loan the money to your friend or deposit it in the bank? a. How much would you have in one year if you deposited the $53.00 instead? If you deposit the $53.00 in the bank today, you will have $ in one year. (Round to the nearest cent.)
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A friend asks to borrow $54 from you and in return will pay you $57 in one year. If your bank is offering a 5.7% interest rate on deposits and loans: a. How much would you have in one year if you deposited the $54 instead? b. How much money could you borrow today if you pay the bank $57 in one year? c. Should you loan the money to your friend or deposit it in the bank? a. How much would you have in one year if you deposited the $54 instead? If you deposit the money in the bank today you will have $ in one year. (Round to the nearest cent.)

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