4. Interest Rate Oliver has the following outstanding balances: Balance ($) Form of Credit Bank Loan Credit Card A Credit Card B a. 6686.98 765.39 1028.14 7.2% compounded monthly 20.99% compounded daily 17.5% compounded daily Monthly Payment $300 Minimum payment of $50 Minimum payment of $30 Length to Pay off Use the last column to determine how long it will take for Oliver to pay of each balance if he pays the (minimum) monthly payment. Show relevant calculations below. b. Suppose Oliver consolidates his loan and credit card balance by using a line of credit to pay off each debt. The line of credit has an interest rate of 7.5%, compounded monthly. If Oliver makes payments of $380, how long will it take to be debt free? c. How much interest would he save by consolidating his debt?
4. Interest Rate Oliver has the following outstanding balances: Balance ($) Form of Credit Bank Loan Credit Card A Credit Card B a. 6686.98 765.39 1028.14 7.2% compounded monthly 20.99% compounded daily 17.5% compounded daily Monthly Payment $300 Minimum payment of $50 Minimum payment of $30 Length to Pay off Use the last column to determine how long it will take for Oliver to pay of each balance if he pays the (minimum) monthly payment. Show relevant calculations below. b. Suppose Oliver consolidates his loan and credit card balance by using a line of credit to pay off each debt. The line of credit has an interest rate of 7.5%, compounded monthly. If Oliver makes payments of $380, how long will it take to be debt free? c. How much interest would he save by consolidating his debt?
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
Related questions
Question
Transcribed Image Text:4.
Interest Rate
Oliver has the following outstanding balances:
Balance ($)
Form of Credit
Bank Loan
Credit Card A
Credit Card B
a.
6686.98
765.39
1028.14
7.2% compounded
monthly
20.99%
compounded daily
17.5%
compounded daily
Monthly
Payment
$300
Minimum
payment of $50
Minimum
payment of $30
Length to Pay
off
Use the last column to determine how long it will take for Oliver to pay of each balance
if he pays the (minimum) monthly payment. Show relevant calculations below.
b. Suppose Oliver consolidates his loan and credit card balance by using a line of credit to
pay off each debt. The line of credit has an interest rate of 7.5%, compounded monthly.
If Oliver makes payments of $380, how long will it take to be debt free?
c. How much interest would he save by consolidating his debt?
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