Jane has a $35,000 bank loan that she wishes to pay off in five equal annual payments with 12% interest. If the first payment is due one year from today, what will be the amount of the annual payment necessary? $fill in the blank 1 b. Joan wants to borrow some money from the bank to start a small business. Joan can afford to pay off the loan in 15 annual installments of $9,500. The bank charges an annual interest rate of 12%. If Joan makes the first payment one year from the date of the loan, how much can Joan borrow? $fill in the blank 2

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A: Monthly payment refers to the function of time, the value of money used for calculating the amount…

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A: Step 1). Monthly payment on the borrowing is calculated using following equation Monthly payment =…

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A: Borrowings are the liability that is used to finance the requirement of the funds. The borrower…

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A: Based on the given information, Interest rate = 8%/4 = 2% Number of periods = 5 years x 4 quarters =…

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A: Future Value = $22,000 Time Period = 6 Years Interest Rate = 5.8%

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Q: 2

A: Interpretation: Present value refers to the current valuation for a future sum. Investors determine…

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A: Using Excel

Q: What is the amount of each payment?

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Q: 9. Aisha is looking for a $20,000 loan to buy a car. One financial institution has agreed to give…

A: Loan is a sum of amount borrowed from a lender. It is expected that the loan will be repaid at a…

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

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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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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.