a. If Suzie chooses 5.3 percent APR financing for 36 months to buy the premium Mustang convertible, which costs $25,000 = PMT(33.216217), what will her monthly payment be? (Round to the nearest cent.) b. If Suzie chooses $800 cash back to buy the premium Mustang convertible and borrows $24,200 from the VTech Credit Union at 7.3 percent APR for 36 months, how much will her monthly payment be? (Round to the nearest cent.) c. Which option should Suzie Student choose? (Select the best choice below.) OA. Choose low interest rate financing because the monthly payment under this option is lower. OB. Choose cash back financing because the monthly payment under this option is lower.

a. If Suzie chooses 5.3 percent APR financing for 36 months to buy the premium Mustang convertible, which costs $25,000 = PMT(33.216217), what will her monthly payment be? (Round to the nearest cent.) b. If Suzie chooses $800 cash back to buy the premium Mustang convertible and borrows $24,200 from the VTech Credit Union at 7.3 percent APR for 36 months, how much will her monthly payment be? (Round to the nearest cent.) c. Which option should Suzie Student choose? (Select the best choice below.) OA. Choose low interest rate financing because the monthly payment under this option is lower. OB. Choose cash back financing because the monthly payment under this option is lower.

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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Chuck Wells is planning to buy a Winnebago motor home. The listed price is $155,000. 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 $3,600 per month and amortize the loan in 42 months. (a) Find Chuck's monthly payment (in $) with these conditions. (Round your answer to the nearest cent.) $ Can he pay off the loan and keep his payments under $3,600? Yes, under these conditions, Chuck will meet his goal.No, the monthly payment is too high. (b) What are Chuck's options to get his payments closer to his goal? (Select all that apply.) try to negotiate a lower interest ratemake a higher down paymenttry to bargain for a higher sale pricetry to bargain for a lower sale pricemake a lower down paymenttry to negotiate a higher interest rate (c) 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…
The Nguyens are thinking of buying a home for $121,000. A potential lender advertises an 80%, thirty-year simple interest amortized loan at 8 and 1/4% interest, with an APR of 9.23%. Use the APR to approximate the fees included in the finance charge. (Round your answer to the nearest cent.)
Ann Is buying a new home for $365,000. She is choosing between 2 loan options. Loan A is a 15-year mortgage at 5% annual interest with a $25,000 down payment and $2688.70 monthly payment. Loan B is a 30-year mortgage at 4% annual interest with a $10,000 down payment and a $1694.82 monthly payment. Which loan has the lowest total cost? a Loan A is lower cost as it is approximately $111,170 less expensive than Loan B. b Loan B is approximately $87,235 less expensive than Loan A. c Loan B is approximately $52,379 less expensive than Loan A. d Loan A is approximately $102,473 less expensive than Loan B.
Your friend is currently paying $734 in rent monthly in Fort Wayne and would rather apply the payment toward purchasing a home. If she can get a 30 year mortgage at 4.67% APR using her current payment amount, how much could she borrow? What could you type into Excel to calculate this value?
Suppose Rachel and Nadia buy a house and have to take out a loan for $191000. If they qualify for an APR of 4.25% and choose a 30 year mortgage, we can find their monthly payment by using the PMT formula. If Rachel and Nadia decide to pay $1500 per month, we can use goal seek to see how many years it will take to pay off the loan. Use the PMT function and goal seek (as needed) to answer the following questions about Rachel and Nadia's mortgage. a. What is their monthly payment on the 30 year loan? $ b. If they qualify for the same APR on a 15 year loan, what will the new monthly payment be? $ c. If Rachel and Nadia have monthly payments of $1500 each month, how long will it take for them to pay off their loan? years d. If they want to have monthly payments of $650 and still pay the loan off in 30 years, what interest rate would they have to qualify for? %
Desmond plans to purchase a new car. He qualifies for a loan at an annual interest rate of 5.2%, compounded monthly for 8 yr. He is willing to pay up to $300 per month. What is the largest loan he can afford? What is the correct formula for this situation? *** A. P OC. A= nt r n <-1 Desmond can afford a loan up to $ (Round to the nearest cent as needed.) OB. OD. A= r n nt -1 r n
7
Chuck Wells is planning to buy a Winnebago motor home. The listed price is $185,000. Chuck can get a secured add-on interest loan from his bank at 7.35% for as long as 60 months if he pays 15% down. Chuck's goal is to keep his payments below $4,300 per month and amortize the loan in 42 months. (a) Find Chuck's monthly payment (in $) with these conditions. (Round your answer to the nearest cent.) $ 4257.64 × Can he pay off the loan and keep his payments under $4,300? Yes, under these conditions, Chuck will meet his goal. No, the monthly payment is too high. (b) What are Chuck's options to get his payments closer to his goal? (Select all that apply.) □ □ □ □ □ make a lower down payment try to bargain for a lower sale price make a higher down payment try to negotiate a higher interest rate try to bargain for a higher sale price try to negotiate a lower interest rate
A family wishes to buy a $235,900 home. - If a conventional lender is willing to loan the family 87% of the price of the home, what will the loan amount be? What will be the down payment with the loan? - If the family decides to obtain an FHA loan instead, what will the minimum down payment be? (FHA loan down payments are 3.5% of the first $25,000 and 5.2% of the balance of the loan). What is the maximum FHA loan the family can obtain?
Qualifying Scenario: Rosanne is buying a home for 900k. She has 110k in liquid assets, a 740 middle credit score, $1200 a month in revolving credit card debt and makes 200k a year. Her lender requires her to have a 90% LTV, 30/43 DTI ratios and 2 months PITI for PCL. The loan will be a 30 year fixed with a 3% interest rate. Her closing costs will be 15k. Escrows will be $1000 a month. She can buy her interest rate down by .125% by paying a half percent discount point. A .25 buy down costs 1 points and so on. She can increase her rate by .125% to get a lender credit of a half point or .25% for 1 point and so on. Does she qualify? If not, why? What can she do to qualify?
Tayah is considering buying a new car for which she will need to borrow $23,900. But first, as she learned in FI 3300, Tayah wants to know how much she will have to pay per month on the dealership loan. The loan that Tayah is being offered has a five-year term, requires monthly payments, and has an interest rate of 4.4% p.a. What is the required monthly payment on this loan, assuming that the first payment will be made exactly one month from today? $439.22 $438.69 $444.48 $451.87 $442.74
Juliana is taking out an $8,700, 3 -year loan with an APR of 2.31%. What will be the monthly payment for this loan? Round to the nearest cent.

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