FutureamountLengthRateRatedesiredof timecompoundedused7 years20 years2% semiannually4% annually1. $ 9,0002. $20,0003. Bill Blum needs $40,000 6 years from today to attend V.P.R. Tech. How mucia must Billput in the bank today (8% quarterly) to reach his goal?4. Bob Fry wants to buy his grandson a Ford Taurus in 4 years. The cost of a car will be$28,000. Assuming a bank rate of 4% compounded quarterly, how much must Bob put inthe bank today?

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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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Monthly loan payments Personal Finance Problem Tim Smith is shopping for a used luxury car. He has found one priced at $31,000. The dealer has told Tim that if he can come up with a down payment of $5,500, the dealer will finance the balance of the price at a 6% annual rate over 4 years (48 months). a. Assuming that Tim accepts the dealer's offer, what will his monthly (end-of-month) payment amount be? b. Use a financial calculator or spreadsheet to help you figure out what Tim's monthly payment would be if the dealer were willing to finance the balance of the car price at an annual rate of 3.4%?
mni.3 A student needs to borrow $7,000 to pay for college. She can get the loan at an APR of 10.75% to be paid off in monthly installments over the next 4 years.If she decides to pay the loan off in monthly installments over 3 years instead of 4 years at the given APR, how much money will she save altogether? Round your answer to the nearest cent.)
Accumulating a growing future sum Personal Finance Problem A retirement home at Deer Trail Estates now costs $145,000. Inflation is expected to cause this price to increase at 4% per year over the 25 years before C. L. Donovan retires. If Donovan earns 9% on his investments, ow large must an equal, end-of-year deposit must be to provide the cash needed to buy the home 25 years from now? The equal, annual end-of-year deposit to be made each year into the account is $ (Round to the nearest cent.)
(Please type answer no write by hend)
Mr. and Mrs. Fuller are buying a new house for $350,000. Compare the two loan offers by finding the monthly payments for each and calculating the total amount paid for each. Loan Options Down Payment Monthly Payment Total 10% down payment, 5.5% APR for 30 years 15% down payment, 4.5% APR for 25 years
Monthly loan payments Personal Finance Problem Tim Smith is shopping for a used luxury car. He has found one priced at $31,000. The dealer has told Tim that if he can come up with a down payment of $6,200, the dealer will finance the balance of the price at a 6% annual rate over 5 years (60 months). a. Assuming that Tim accepts the dealer's offer, what will his monthly (end-of-month) payment amount be? b. Use a financial calculator or spreadsheet to help you figure out what Tim's monthly payment would be if the dealer were willing to finance the balance of the car price at an annual rate of 3.8%? a. Tim's monthly (end-of-month) payment amount is $ (Round to the nearest cent.)
Michael wants to buy some new exercise equipment for his home gym for $312,000 financed at an annual interest rate of 13% using the add-on method. If Michael wants to pay off the loan in 4 years, what will be his monthly payment? Question content area bottom Part 1 His monthly payments are $enter your response here. (Round to the nearest cent as needed.)
14. Loan amortization and capital recovery After Shipra got a job, the first thing she bought was a new car. She took out an amortized loan for $45,000—with no ($0) down payment. She agreed to pay off the loan by making annual payments for the next four years at the end of each year. Her bank is charging her an interest rate of 10% per year. Yesterday, she called to ask that you help her compute the annual payments necessary to repay her loan. Calculate the annual payment and complete the following loan amortization table: Year Beginning Amount Payment Interest Paid Principal Paid Ending Balance 1 $45,000.00 2 3 4 -$0.02
Mr. and Mrs. Williams are buying a new house for $350,000. Compare the two loan offers by finding the monthly payments for each and calculating the total amount paid for each. Loan Options Down Payment Monthly Payment Total 10% down payment, 5.5% APR for 30 years 15% down payment, 4.5% APR for 25 years
Future value. Jack and Jill are saving for a rainy day and decide to put $40 away in their local bank every year for the next 20 years. The local Up-the-Hill Bank will pay them 6% on their account. a. If Jack and Jill put the money in the account faithfully at the end of every year, how much will they have in it at the end of 20 years? b. Unfortunately, Jack had an accident in which he sustained head injuries after only 10 years of savings. The medical bill has come to $400. Is there enough in the rainy-day fund to cover it? a. If Jack and Jill put the money in the account faithfully at the end of every year, how much will they have in it at the end of 20 years? $nothing (Round to the nearest cent.)
You decided to save every month for the next ten years a certain amount so that you can make a down payment for a house in your early thirties. If you think you can make an annual return of 9% and you think you will need to save $50,000 for the down payment, how much should that monthly payment be? a. $258 b. $464 c. $3291 d. $536

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