Jamie needs a new roof on her house. The cash cost is $5600. She decides to finance the project by paying 6.0% down, with the balance paid in 12 monthly payments of $463. a) What finance charge will Jamie pay? b) What is the APR to the nearest half percent? Click the icon to view the APR table. a) The finance charge is $ b) The APR is %.
Jamie needs a new roof on her house. The cash cost is $5600. She decides to finance the project by paying 6.0% down, with the balance paid in 12 monthly payments of $463. a) What finance charge will Jamie pay? b) What is the APR to the nearest half percent? Click the icon to view the APR table. a) The finance charge is $ b) The APR is %.
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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Transcribed Image Text:Jamie needs a new roof on her house. The cash cost is $5600. She decides to finance the project by paying 6.0% down, with the balance paid in 12 monthly
payments of $463.
a) What finance charge will Jamie pay?
b) What is the APR to the nearest half percent?
Click the icon to view the APR table.
a) The finance charge is $
b) The APR is
%.
Transcribed Image Text:Number of
payments
6
12
18
24
30
36
48
60
4.0% 4.5% 5.0%
Annual Percentage Rate Table for Monthly Payment Plans
Annual Percentage Rate
5.5% 6.0% 6.5% 7.0% 7.5% 8.0% 8.5%
2.79 2.93
1.17 1.32 1.46
2.18 2.45 2.73
3.20 3.60 4.00
5.22
5.50
6.86 7.28 7.69
8.10
(Finance charge per $100 of amount financed)
1.61 1.76 1.90 2.05 2.20 2.35 2.49 2.64
3.00 3.28 3.56 3.83 4.11 4.39 4.66 4.94
4.41 4.82 5.22 5.63
6.04 6.45
5.83 6.37 6.91 7.45
8.00 8.54 9.09 9.64 10.19 10.75
8.61 9.30 9.98 10.66 11.35 12.04 12.74 13.43
9.52 10.34 11.16 11.98 12.81 13.64 14.48 15.32 16.16
17.18 18.31 19.45 20.59 21.74
4.22 4.75 5.29
5.25 5.92 6.59 7.26 7.94
6.29 7.09 7.90 8.71
8.38 9.46 10.54 11.63 12.73 13.83 14.94 16.06
10.50 11.86 13.23 14.61 16.00 17.40 18.81 20.23 21.66 23.10 24.55 26.01 27.48
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9.0% 9.5% 10.0%
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