A contractor decided to borrow $7000 from a bank in order to buy an equipment for his company. The bank allows him pay back his loan in five years at a monthly interest rate of 2%. the farmer can pay $71 per month but can increase his monthly payment by a certain value in arithmetic way (G value). What should be the G value so that he finished the loan by the end of five years? O $ 243326.21 O $ 4531.98 $ 3.00 $ 5.50 O $ 9468.02

A contractor decided to borrow $7000 from a bank in order to buy an equipment for his company. The bank allows him pay back his loan in five years at a monthly interest rate of 2%. the farmer can pay $71 per month but can increase his monthly payment by a certain value in arithmetic way (G value). What should be the G value so that he finished the loan by the end of five years? O $ 243326.21 O $ 4531.98 $ 3.00 $ 5.50 O $ 9468.02

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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Concept explainers

Cost of Credit

The cost of credit is an extra amount that the borrower has to pay besides the loan amount. These credit charges may vary from loan to loan. The cost of credit includes interest charges, maintenance charges, and arrangement charges. Some of the costs are mandatorily collected by the lender based on the loan amount and tenure of the loan. The cost of credit is also called finance charges of the credit.

Question

A contractor decided to borrow $7000 from a bank in order to buy an equipment for his company. The bank
allows him pay back his loan in five years at a monthly interest rate of 2%. the farmer can pay $71 per month
but can increase his monthly payment by a certain value in arithmetic way (G value). What should be the G
value so that he finished the loan by the end of five years?
O $ 243326.21
O $ 4531.98
O $ 3.00
O $ 5.50
O $ 9468.02

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The problem describes a debt to be amortized. (Round your answers to the nearest cent.)A man buys a house for $330,000. He makes a $150,000 down payment and amortizes the rest of the purchase price with semiannual payments over the next 9 years. The interest rate on the debt is 10%, compounded semiannually. (a) Find the size of each payment.$ (b) Find the total amount paid for the purchase.$ (c) Find the total interest paid over the life of the loan.$
Peter has borrowed $8,600 to pay for his new car. The annual interest rate on the loan is 7.4 percent, and the loan needs to be repaid in four payments. What will be his annual payment if he begins his payment today now? (Round to the nearest dollar.) a. $2,850 b. $2,656 c. $2,385 d. $2,448
Chuck Wells is planning to buy a Winnebago motor home. The listed price is $175,000. Chuck can get a secured add-on interest loan from his bank at 7.45% for as long as 60 months if he pays 15% down. Chuck's goal is to keep his payments below $4,100 per month and amortize the loan in 42 months. 1) Chuck spoke with his bank's loan officer, who has agreed to finance the deal with a 6.95% loan if Chuck can pay 20% down. What will Chuck's new monthly payment (in $) be with these conditions? (Round your answer to the nearest cent.) $ With these conditions, will Chuck be able to pay off the loan and meet his goals? Yes, under these conditions, Chuck will meet his goal.No, the monthly payment is too high. 2) Attempting to reduce his monthly payment further, Chuck continues to negotiate with the seller. If the seller agrees to reduce the listed price by $4,800, finance the deal with a 6.95% loan, and if Chuck pays the 20% down, what will Chuck's monthly payment be (in $)?…
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