Assume that you borrow $5000 and pay back the $5000 plus $250 in interest at the end of the year. Assuming no inflation, what is the real interest rate? What would the interest rate be if the $250 of interest had been discounted at the time the loan was made? What would the interest rate be if you were required to repay the loan in 12 equal monthly installments?

Q: Suppose you borrow $8500 for a term of five years at a simple interest and 8.25% APR. how much is…

A: Interest is the cost of borrowing the money.

Q: Question 14

A: Service department: A service department is a division in an organization which is not involved…

Q: I borrow £5000 and agree to pay back £6000 after 18 months. Whatever is the annual rate of compound…

A: Annual Compounding refers to the financial process of adding interest to initial amount with the…

Q: a man borrows money from a bank . he receives the money in 5 equal annual installment of X…

A: The time worth of cash (TVM) is the idea that cash you have now is worth more than the…

Q: (Annuity interest rate) You've been offered a loan of $25,000, which you will have to repay in 5…

A: When the borrower borrows a loan from the lender, he has to pay a rate of interest on the borrowed…

Q: You to plan to borrow at 35000 at a 7.5 annual interest rate. The terms require you to authorize the…

A: To calculate the interest paid in year 2 of the loan, we can use the formula for calculating the…

Q: You plan to borrow $49,400 at a 7.3% annual interest rate. The terms require you to amortize the…

A: Yearly installments= $49400* R* (1+R)^n/((1+R)^N-1) = 49400* 7.3%* (1+7.3%)^7/((1+7.3%)^7-1) = 9262

Q: If you take out a 4 year loan for $16,500 at your bank and pay the quarterly payments for the 4…

A: Total interest is = total payments - loan

Q: If you borrowed $2400 at an annual simple interest rate of 5.75%, how much would you owe altogether…

A: Interest on loan=Amount Borrowed×Rate×Years=$2,400×5.75%×3.5=$483

Q: You borrow $625 for 60 days at a simple interest rate of 2.9%. What is the interest on the loan? Be…

A: The Bankers’ rule is a measure of calculating simple interest where the exact number of days of the…

Q: which amongst the following would not form part of cost of equipment? A) freight charges B)…

A: Cost of equipment means the amount which is incurred to acquire the equipment and to bring the…

Q: Suppose you have $1500 in your savings account at the end of a certain period of time. You invested…

A: Interest Earned = $1500 -$1100 Interest Earned =$400

Q: Banks sometimes quote interest rates in the form of “add-on interest.” In this case, if a 1-year…

A: Annual percentage rate is the interest rate paid in a year on loan amount or on investment. It is…

Q: If $500 is borrowed and the interest after 18 months is $45, what is the annual interest rate for a…

A: Given:

Q: 2. Suppose you put $100,000 in a certificate of deposit with an annual interest rate of 6 percent…

A: 2 (A) $126,247.7 (B) $1,27,048.9 (C) $126,898.6

Q: Find the interest paid on a loan of $2,700 for one year at a simple interest rate of 11% per year.…

A: Simple interest = Principle × rate × time

Q: To payoff a loan of $1000 you need to make 40 payment of $36.56 per month. What rate of interest are…

A: Annual percentage rate refers to the interest rate paid by the borrower to the lender on a yearly…

Q: You borrow $175,000; the annual loan payments are $10,120.27 for 30 years. What interest rate are…

A: Interest on a loan is the additional amount of money that a borrower has to pay back to the lender…

Q: (Compound interest with nonannual periods) After examining the various personal loan rates available…

A: Payoff of the loan is calculated using the future value formula.  Future value formula is as…

Q: Suppose that you want to avoid paying interest and decide you'll only buy the furniture when you…

A: Future value is the compounded value of all future cash flows after the specified period of time and…

Q: You borrow $1,000 from the bank and agree to repay the loan over the next year in 12 equal monthly…

A: We can calculate the effective annual interest rate by applying the required formula taking the loan…

Q: You borrow $90,000; the annual loan payments are $12,852.25 for 30 years. What interest rate are you…

A: Interest :  It is the total amount payment on loan taken or fund borrowed by any person . it may be…

Q: Suppose that your unsubsidized Stafford loans plus accumulated interest total $ 27000 at the time…

A: Compound = monthly = 12 Present value = pv = $27,000 Interest rate = 8 / 12% Time = t = 10 * 12 =…

Q: Assuming that the interest is the only finance charge, how much interest would be paid on a 5,000…

A: Interest is the amount paid on a loan by the borrower to the lender above the principal amount to…

Q: Suppose that you’d like to retire in 40 years and you want to have a future value of $ 900000 in a…

A: APR: The annual interest rate that is charged to the borrowers is known as the annual percentage…

Q: Suppose an annuity pays $2000 at the end of each 3 month period for 3.5 years at an interest rate of…

A: given, A = $2000 n = 3.5 r = 4% pa but it is compounded quarterly therefore, frequency of…

Q: A person borrows $390 that he must repay in a lump sum no more than 10 years from now. The interest…

A: Loan amount = $ 390 Annual interest rate = 9.9%

Q: You've borrowed $6,903.71 and agreed to pay back the loan with monthly payments of $270. Assume the…

A: Compound = Monthly = 12Present Value = pv = $6903.71Monthly Payment = p = $270Interest Rate = r = 15…