Albert takes a loan out to buy a second-hand car.The loan is for £1,500. The interest rate on the loan is 4% compound interest per month.If Albert makes no payments on the loan, how much will he owe after six months? Giveyour answer in pounds to the nearest penny.

Time Value of Money :— According to this concept, value of money in present day is greater than the…

Answered: Albert takes a loan out to buy a…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Similar questions

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To go on a summer trip, Michael borrows $800. He makes no payments until the end of 3 years, when he pays off the entire loan. The lender charges simple interest at an annual rate of 6%. Answer the following questions. If necessary, refer to the list of financial formulas. (a) How much total interest will Michael have to pay? $120 (b) What will the total repayment amount be (including interest)? $920
To rent an apartment, Nick has to pay the first month of rent plus the last month of rent and a security deposit. The total that he has to come up with is $7,485. He has $1,150 available and decides to take the remainder out as a cash advancement on his credit card. The interest is 25.25 % compounded daily. If Nick waits to pay off the cash advance after 7 months, how much does he owe? Assume that each month has 30 days.
Jonathon wishes to buy a used Chevy Malibu for $12,500. He only has $1,000 for a down payment so the best deal he can get on a loan is 9% for 48 months. What will his payments be? What is the total interest over the life of the loan?
Will has a 30-year mortgage on a $100,000 loan for his house in Florida. The interest rate on the loan is 6% per year (nominal interest), payable monthly at 0.5% per month. Solve, a. What is Will’s monthly payment? b. If Will doubles his payment from Part (a), when will the loan be completely repaid?
A student borrows $3000 from his uncle in order to finish school. His uncle agrees to charge him simple interest at the rate of 5.5% per year. Suppose the student waits two years and then repays the entire loan. How much will he have to repay?
Mason borrows $41,217.00 to buy a car. He will make monthly payments for 6 years. The car loan has an interest rate of 5.40% p.a. After 18 months Mason decides to pay off his car loan. How much does he owe on the loan?
Alan loans $3750 to Betty at a 6.2% simple interest rate. Betty agrees to repay the loan after 13 months. After 3 months, Alan needs money unexpectedly, so he sells the loan to Chris for $3800. What annual rate of simple interest does Chris earn on this investment? Give your answer as a percentage, rounded to 2 decimal places.
Craig decides to purchase a property that has been valued at $475,000. He has $80,000 available as a deposit and will require a mortgage for the remaining amount. The bank offers him a 25 year mortgage at 2% interest. Calculate the total interest he will pay over the life of the loan, assuming he makes monthly payments. Give your answer in dollars to the nearest ten dollars.
Jino sold his house. In addition to cash, he took a mortgage on the house. The mortgage will be paid off by monthly payments of P12, 345 for 10 years. He decided to sell the mortgage to a local bank. The bank will buy the mortgage, but requires a 1% per month interest rate on their investment. How much will the bank pay for the mortgage?
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Albert takes a loan out to buy a second-hand car. The loan is for £1,500. The interest rate on the loan is 4% compound interest per month. If Albert makes no payments on the loan, how much will he owe after six months? Give your answer in pounds to the nearest penny.