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If Martha borrowed $22,000 from Wachovia Bank at 7.5 percent interest for 3 years, the principal (face value) of the loan would be
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- Priya and Ronnie borrow $500,000 from the EastSide bank, to be paid back through monthly repayments over 12 years, with the first repayment to occur one month after taking out the loan. EastSide charges at interest j12 = 6.12% p.a. Under the terms of the loan, Priya and Ronnie will pay interest only for the first 2 years of the loan. At that point the loan will change to a fully amortized (principal and interest) loan, which will apply for the final 10 years of the loan’s duration. a) Illustrate the cash flows associated with loan as a fully labelled timeline diagram. b) Determine the size of the monthly repayments during the first two years of the loan. c) Determine the size of the monthly repayments during the last 10 years of the loan. d) Find the Outstanding Principal immediately after Priya and Ronnie’s 141st repayment. e) Construct an amortization schedule showing the last 3 repayments. [Ensure that you show your working for one line of the amortization schedule.] f)…c. By how much will the amortization period shorten if Shawn made an extra payment of $54,000 at the end of the year 3? years E months Express the answer in years and months, rounded to the next monthCarol borrows $30, 000 from the bank. For a six-year loan, the bank requires annual end-of-year payments of $5, 878.05. The annual interest rate on the loan is?
- Amber received a 15 year loan of $245,000 to purchase a house. The interest rate on the loan was 5.70% compounded semi-annually. a. What is the size of the monthly loan payment? b. What is the balance of the loan at the end of year 4?c . By how much will the amortization period shorten if Amber makes an extra payment of $30,000 at the end of year 4?Cassandra received a 30 year loan of $320,000 to purchase a house. The interest rate on the loan was 3.70% compounded semi-annually. a. What is the size of the monthly loan payment? Round to the nearest cent b. What is the balance of the loan at the end of year 3? Round to the nearest cent c. By how much will the amortization period shorten if Cassandra makes an extra payment of $30,000 at the end of year 3? years and monthsmJason received a 30 year loan of $290,000 to purchase a house. The interest rate on the loan was 2.80% compounded semi-annually. a. What is the size of the monthly loan payment? Round to the nearest cent b. What is the balance of the loan at the end of year 3?
- Suppose Allison purchases a condominium and secures a loan of P13,400,000 for 30 years at an annual interest rate of 6.5%. a. Find the monthly mortgage payment. b. What is the total of the payments over the life of the loan? c. Find the amount of interest paid on the loan over the 30 yearsAbigail received a 15 year loan of $280,000 to purchase a house. The interest rate on the loan was 5.80% compounded semi-annually. a. What is the size of the monthly loan payment? b. What is the balance of the loan at the end of year 2? c. By how much will the amortization period shorten if Abigail makes an extra payment of $30,000 at the end of year 2?A woman borrows $3000 at %9 compounded monthly, which is to be amortized over 3 years in equal monthly payments. For tax purposes, she needs to know the amount of interest paid during each year of the loan. Find the interest paid during the first year, the second year, and the third year of the loan. (Hint: Find the unpaid balance after 12 payments and after 24 payments. Also see example in your notes.)
- James received a 15 year loan of $230,000 to purchase a house. The interest rate on the loan was 2.10% compounded semi- annually. a. What is the size of the monthly loan payment? b. What is the balance of the loan at the end of year 2? Round to the nearest cent c. By how much will the amortization period shorten if James makes an extra payment of $30,000 at the end of year 2?Asma has borrowed $1,000,000 from MQ Bank for 10 years at an interest rate of j2=4.67% p.a. She will make 10 annual repayments. According to the loan agreement, Asma's repayments will be $83,000 for the first two years followed by payments of X per year for the remaining eight years. This loan needs to be fully repaid by the end of 10 years. (b) Assume that all annual repayments will be paid at the beginning of each year (the first payment will be at the start of the first year), what is the value of Asma's annual payment amount, X (rounded to four decimal places)? Question 7Answer a. 134233.5495 b. 128177.7626 c. 127887.4496 d. 133859.7935If a consumer borrows a loan of $23, 000, and pay it off in 5 years, including the finance charges of $1, 000, What is the effective annual rate of interest?
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