A certain company sells engines worth P1,000,000 cash. If paid on installment basis, it requires a down payment with the balance payable quarterly in 2 years at an interest rate of 8% pa compounded quarterly. What must the required down payment be if the quarterly payment is P65,000.00? a. P 523,843.71 b. P 404,297.49 c. P 459,050.50 d. P 562,980.65

A certain company sells engines worth P1,000,000 cash. If paid on installment basis, it requires a down payment with the balance payable quarterly in 2 years at an interest rate of 8% pa compounded quarterly. What must the required down payment be if the quarterly payment is P65,000.00? a. P 523,843.71 b. P 404,297.49 c. P 459,050.50 d. P 562,980.65

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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SunBlush Technologies takes out a $16,000 loan that charges 5.25% interest compounded semi-annually has fixed quarterly payments of $650. Answer the following questions. For full marks your answer should be rounded to the nearest cent. a) How long will it take to pay off the loan? Your answer should be rounded to the appropriate whole period. 0 years, 0 months b) What is the principal component of the 20th payment? Principal = $0.00 c) What is the interest component of the 9th payment? Interest = $0.00 d) How much is the principal reduced by payments 15 through 18? Principal = $0.00 e) What is the total interest paid for payments 1 through 4? Interest = $ 0.00
An air conditioner is for sale at P20,000 in cash or on terms, P1,650 each month for the next 18 months. If the interest rate is 6% compounded monthly, how much more is the total cost of the installment term compared to its cash price? a. P10,564.65 b. P11,547.36 c. P7,890.50 d. P8,335.07 с.
A businessman obtains a loan of $100,000 for a 5-year term with an interest rate of 7% per year, compounded quarterly, which must be paid in quarterly installments by the French amortization system. If the interest rate is reset to 6% annually compounded quarterly after payment 16; determines the value of the new quarterly installment. 1) $2356.87 2) $5932.82 3) $6947.23 d) $5,532.76 e) $4,578.92
Gela Corporation borrows P250,000.00 at 15% percent annual interest. Principal and interest is due in 1 year. What is the effective interest rate? choose the letter of answer a. Noneb. 15%c. 19%d. 20%e. 21%
A car costing $ 63083 is purchased with a 25% down payment and further payments of X at the end of every month for 10 years. The annual nominal interest rate is 11% convertible monthly. Calculate X. a. $625.66 b. $578.26 c. $555.13 d. $651.73 e. $638.69
For items 14-15. A car is to be purchased in monthly payments of P17,000 for 4 years starting at the end of 4 months. How much is the fair market value of the car if the interest rate used is 12% converted monthly and down payment is 65,000? _____14. How much is the present value of the car? A. 620,367.89 B. 626,571.57 C. 666,505.52 D. 659,906.45 _____15. How much is the fair market value? A. 724,906.45 B. 731,505.52 C. 691,571.57 D. 685,367.89
On January 1, a company agrees to pay $15,000 in six years. If the annual interest rate is 3% , determine how much cash the company can borrow with this agreement. (PV of $1. FV of $1. PVA of $1, and EVA of $1) (Use appropriate factor(s) from the tables provided. Round "Table Factor" to 4 decimal places.) Future Value 15,000 Table Factor 4 Amount Borrowed
No handwritten
A $250,000 loan, with annual interest at 5.7%, c/sa, requires semi-annual, end of period payments of $11,000.How much interest is paid on the 30th payment?
Give typing answer with explanation and conclusion YG Corporation recently issued 270-day commercial paper with a face value of $2,000,000 and a simple interest rate of 11 percent. The company paid a transaction fee equal to 0.4 percent of the issue, which was taken out of the issue amount before the company received any funds. Assuming there are 360 days in a year, what is the commercial paper's effective annual rate (rEAR)? a. 17.51% b. 11.99% c. 12.56% d. 12.63% e. 12.82%
9. A company borrows 1,000,000 at an annual effective discount rate of 4%. The loan is to be repaid with n annual payments of 100,000 plus a drop payment one year after the nth payment. The first payment is due two years after the loan is taken out. Calculate the amount of the drop payment. A 87.072.14 B 90,700.14 C 94,479.31 D 98,415.95 E 99,999.99
An installment contract for the purchase of a car requires payments of $346.34 at the end of each month for 2 years. Interest is 5% per annum compounded monthly. (a) What is the amount financed? (b) How much is the interest cost? (a) The amount financed is $ (Round the final answer to the nearest cent as needed. Round all intermediate values to six decimal places as needed.) (b) The interest is $. (Round the final answer to the nearest cent as needed. Round all intermediate values to six decimal places as needed.)

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