Bonita intends to open a small fabric shop and borrows the money for it from her aunt Magda. Bonita feels that she will only be able to start repaying her debt after three years. Bonita will then pay aunt Magda R105 000 per year for five years. Money is worth 19,5% per year.   The present value of Bonita’s debt at the time she will start paying aunt Magda back is [1] R408 978,93. [2] R317 500,78. [3] R222 924,04. [4] R525 000,00. [5] R436 649,07.

Q: how much must she pay each month?

A: Mortgage Payments: Mortgage payments are made to the lender by the borrower for taking a loan.…

Q: A woman buys a house for a ​$260,000. She pays ​$20,000 down and takes out a mortgage at 5.1​% for…

A: Purchase Price of House = pp = $260,000Down Payment = dp = $20,000Compound = Monthly = 12Interest…

Q: is expected to be received in 5 years and her last annual payment is expected in 10 years. She can…

A: Annual payment=$49900Interest rate=12.84%Period= 5 years

Q: Maria saved money for her dream house but she needed Php700,000 more to complete the deal. The banks…

A: We take loans or mortgages to purchase large ticket items like a car or a house. The loan or the…

Q: Ms. Madison has an existing loan with payments of $782.34. The interest rate on the loan is 10.5%…

A: A loan refers to a contract where a borrower receives money from a lender on the promise of future…

Q: Alan loans $3750 to Betty at a 6.2% simple interest rate. Betty agrees to repay the loan after 13…

A: Simple rate of interest is calculated by multiplying the rate with principal and adjusting the same…

Q: Ms. Anderson plans to purchase a home for $300,000. She intends to pay 20% of the purchase price as…

A: A written agreement through which a lender gets the right to take the property that is put as a…

Q: Sara purchased a three-bedroom, two-storey house for $209 000 with a 10% down payment. The mortgage…

A: The down payment refers to the money paid by the customer in the early stage of purchasing the…

Q: Kobe has a mortgage for $798,337.00. The term of the mortgage is 4 years, and the amortization…

A: Loan amortization is the process of making equal payments over the life of the loan. These regular…

Q: Clara borrows $41,000 today at 2.9% per year compounded quarterly, to start her own buisness. she…

A: Given, Loan amount (p) = $41,000 Interest rate (r) = 2.9% Number of compounding periods (m) = 4…

Q: Fatzamata and Maggie have $30,000 for a down payment on a future house. Their budget can accomodate…

A: Given: Amount available for downpayment : $30,000 Monthly mortgage payment: $1200 The amount owed to…

Q: must she

A: An installment that is paid on monthly basis is called PMT. A fixed amount of interest is to be…

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A: Loan amount (P) = $589,000 Monthly interest rate (r) = 0.0025 (i.e. 0.03 / 12) Monthly period of…

Q: Ellery purchases a home with a loan of R149 000. The 30-year loan term and 7,5% interest rate apply…

A: Loan installment is that which is paid by borrower to lender for a specified period of time. This…

Q: Tara has just bought a house for $930,000 with a 30% down payment and a 70% mortgage loan for 20…

A: Given: Cost of house = $930,000 Down payment = 30% Interest rate = 2.19% Years = 20

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A: Loans are paid in equal monthly payments and these payments carry the payment for interest and…

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A: Mortgage amortization refers to a schedule which is prepared to shows the periodic loan payments,…

Q: Sarah secured a bank loan of $150,000 for the purchase of a house. The mortgage is to be amortized…

A: A mortgage is a loan used to purchase a property or real estate. The property serves as collateral…

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A: Rate of interest =2% Period =5 years  Payment =$400 per year  Future value FACTOR =(1+r)n/r Future…

Q: (6) Marian has just purchased a house. She has a $400,000, 20-year mortgage with interest at an…

A: Loan Amount = 400,000 Time Period = 20 years or 240 months Rate = 4.5% Continuous Compounding

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A: Given: Years = 30 Fixed interest rate = 5% Cost = $450,000 Down payment = 20%

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A: Loan amount (L) = Price - Down payment = 90% of RM 150000 = RM 135000 Monthly payment (M) = RM…

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A: Mortgage loans are paid by equal periodic and fixed payments and these carry the payment of interest…

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A: When a loan is taken to buy a big ticket item like a house the borrower usually makes monthly…

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A: The future value is the future worth of the amount that will be paid or received in the future.

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A: Present Value refers to the current value of the loan or mortgage amount if paid all at once on the…

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A: Mortgage loans are paid by the monthly payments and these amount carry the payment for interest and…

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A: Interest earned refers to the product of amount invested/borrowed, time period and interest rate.

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A: The present value of all future payments should be equal to the cost of house financed.

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A: In order to find the monthly payment one can use excel and in excel use PMT function.

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A: A mortgage refers to a covered loan that is borrowed for purchasing a property with the property…

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A: Here,Down Payment $   30,000.00Semi Annual Payment $     9,000.00Interest Rate5.70%Time Period in…

Q: Maria agreed to pay Php100,000.00 down payment and Php 50,000.00 bi-monthly installments for the car…

A: The term loan is a financial term that represents the amount borrowed by one person from another.…

Q: Jane Doe earns $41,400 per year and has applied for a(n) $89,000, 25-year mortgage at 7 percent…

A: Amount available for mortgage payment= Debt Service Ratio * Monthly income -  Monthly Property taxes

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.