4. You plan to lease (Begin Mode!!!) a new care today. The dealership's finance office quotes you a dealwith no money down and a $450 monthly payment (assume no taxes) for the next 36 months. Attheend of the 36 months you plan to buy the car for $18,000. Thelisted price today for the car is $30,000What CAP RATE (the interest rate on the lease) are they charging for this lease deal?Some notes:Think about which way your cash flows go. You willl make a $450 payment each month. You willalso pay $18,000 at the end of the lease if you buy the carThe I/Y you calculate for the MONTHLY payments is not the final answer!1.2.NI/YPVPMTFVCAP RATE on the lease:(This is the answer to the question)

Calculation of interest rate and future value:Answer: Interest rate is 3% and future value is…

Answered: 4. You plan to lease (Begin Mode!!!) a…

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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Your lease calls for payments of $500 at the end of each month for the next 12 months. Now your landlord offers you a new 1-year lease which calls for zero rent for 3 months, then rental payments of $700 at the end of each month for the next 9 months. You keep your money in a bank time deposit that pays a simple annual rate of 5 percent. By what amount would your net worth change if you accept the new lease? (Hint: Your return per month is 5%/12 = 0.4166667%.) Group of answer choices +$509.81 −$509.81 +$253.62 −$253.62 +$125.30
Let’s assume that you plan to purchase a house which is selling for $350,000 today. You will make a monthly payment for the next 30 years, with an annual interest rate of 3%. What will be the amount of your monthly mortgage (i.e., home loan) payment? answer choices $1,890.37 $1,400.01 $1,475.61 $1,228.14
Annuity due. Reginald is about to lease an apartment for 30 months. The landlord wants him to make the lease payments at the start of the month. The monthly payments are $1,300 per month. The landlord says he will allow Reg to prepay the rent for the entire lease with a discount. The one-time payment due at the beginning of the lease is $33,886. What is the implied monthly discount rate for the rent? If Reg is earning 1.5% on his savings monthly, should he pay by month or make the one-time payment? What is the implied monthly discount rate for the rent? % (Round to two decimal places.)
Kk.197.
12. There is only one floor plan at Apple Apartments. The first floor rents for $900, the second floor rents for $800 and the third floor rents for $975. If you sign a 13-month lease you get the first month free (there's no option to prorate the savings.) There is a $250 admin fee, $25 key deposit and $75 application fee. How should the Rent, Special Type, Special Amount and Lease Term be entered? Special Type Rent 1 2 3 4 Special Amount Lease Term Lease Special Type Special Rent Term Amount month month 800 1 - No special: a. 12 938 3-One times 938 13 b.
If you buy a home with less than 20% down, you will pay an additional monthly fee, PMI (private mortgage insurance), until you reach 20% equity. Keep track of when you reach 20% equity so you can request to have your PMI removed. Ken Buckmiller’s home recently appraised at $290,000. His mortgage was for $275,000 at 5% for 30 years with PMI of $229.17 per month. What is his monthly payment plus PMI? His mortgage balance is currently $222,990. Has he reached 20% equity? (Use Table 15.1.) (Do not round intermediate calculations. Round your answer to the nearest cent.)
Todd Foley is applying for a $290,000 mortgage. He can get a $2,030 monthly payment for principal and interest and no points, or a $1,827 monthly payment with 4 points? How many months will it take Todd to cover the cost of the discount points if he takes the lower monthly payment?
You buy a car for $20,060 and get a grace period to not make payments for the first 6 months. However you still earn interest in that time, 2.19% every month. What is the value of the loan 6 months after you bought the car when you make your first payment at the beginning of the (n+1]th month (end of the first month)
Many mortgage company allow youto "buy down" your interest rate of your loan by buying points. A point is equal to 1% of your mortgage amount (or $1,000 for every $100,000). You're essentially paying some interest up front in exchange for a lower interest rate over the life of your loan. Find the following payments and total cost (including points) of a $170,000.00 that is borrowed for 30 years with a) 6, % compounded monthly with no points $ The total cost would be $ 1 b) 6– % compounded monthly with 1 point $ 4. The total cost would be $ c) 6% compounded monthly with 2 points $ The total cost would be $
A real estate broker decides to lease a car for 36 months. Suppose the annual interest rate is 7.8%, the negotiated price is $48,000, there is no trade-in, and the down payment is $3,000. Find the monthly lease payment (in dollars). Assume that the residual value is 48% of the MSRP of $51,800.

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