Kat is looking to but her first car. She has figured that she can afford to make up to a $388 monthly payment to the bank for a car loan. She plans to pay off the car loan in 5 years and the bank is willing to give her a 6% interest rate, compounded monthly.  What is the maximum amount she can borrow to purchase a car? (How expensive of a car can she afford) Round to the dollar $

Q: George buys a car every 6 years for P18,000. He trades in his current car to count as the 20%…

A: Given information: George: Price of car : 18,000 Down payment : 20% Interest rate : 12% Time period…

Q: You decide to use $10,000 from your combined accounts to pay down your student loan, and use the…

A: A mortgage is a kind of loan that a lender or financial institution offers to people or companies to…

Q: Sara Beth wants to purchase a used car in excellent condition. She has decided on a car with low…

A: The loan amortization table is the schedule of repayment with a bifurcation of interest paid in each…

Q: Mack wants to buy an used car that has a sticker price of $15600 .he has a down payment of $5000 and…

A: Simple Interest is method of computing interest where compounding is ignored and interest is…

Q: You are deciding to buy a car to commute to work given the comparatively low interest of 6% per…

A: A loan is a debt arrangement that provides financial assistance to a person to full fill a specific…

Q: Dean decides to buy a used vehicle. The vehicle cost $10,000 and his car loan APR is 2.5%. If it…

A: Given information: Cost of vehicle is $10,000 APR is 2.5%, Number of years is 4

Q: maria can afford 250 per month car payment. she found a 5 year loan at 7% interest. how expensive of…

A: The value of the expensive car Maria can afford can be calculated by finding the present value of…

Q: Erika is weighing her options for transportation.  She’s narrowed them down to the following: Option…

A: Therefore, the monthly payment for option A is $314.71.

Q: Dan is contemplating trading in his car for a new one. He can afford a monthly payment of at most…

A: Amount received for trade-in = $6,000  Monthly Payment, P = $500  Interest rate = 2.2%  Number of…

Q: Erika is weighing her options for transportation. She's narrowed them down to the following: Option…

A: A theory that helps to compute the present or future value of the cash flows is term as the TVM…

Q: Jane is planning on saving for a car purchase in 8 years, however, she can only contribute to the…

A: Here we will use the concept of annuities and time value of money. The amount invested by Jane at…

Q: Maria and John decide to shop for furnishings for the new house.  They choose items that amount to…

A: Computation:

Q: Sarah negotiated a price of $25,250.00 for a new Toyota Camry Hybrid Sedan. She is prepared to give…

A: Interest refers to the amount of money charged by a lender to a borrower for the use of borrowed…

Q: Angela Montery has a five-year car loan for a Jeep Wrangler at an annual interest rate of 5.7% and a…

A: The computation of payoff of the loan is as follows:

Q: Zoë is buying a new car. Because of her excellent credit, Zoë is getting her financing at 3.25% APR.…

A: Solution:- When an amount is borrowed, it can either be repaid as a lump sum payment or in…

Q: Ali is willing to pay $210 a month for 5 years for a car payment. If the interest rate is 5%,…

A: A loan is a type of credit that is given to an individual by the financial institution and on the…

Q: If Sandy can afford car payments of $320 per month for 7 years, what is the price of a car that she…

A: A series of equal payments at regular intervals over a period of time is called an annuity. If the…

Q: Maria and John decide to shop for furnishings for the new house.  They choose items that amount to…

A: Formula for simple interest  Future value =Principal + interest rate x number of years

Q: Hank purchased a car for $26,000 two years ago using a 5-year loan with an interest rate of 9.0…

A: A study that proves that the future worth of the money is lower than its current value due to…

Q: Rachel purchased a car for $20,000 three years ago using a 4-year loan with an interest rate of 9.0…

A: Annuity refers to a series of regular payments made over a set or defined period. When the payments…

Q: (Annuity payments) Prof. Finance is thinking about trading cars. She estimates she will still have…

A: Step 1:Step 2:Step 3: Step 4:

Q: Judy has $2,000 for a down payment on a vehicle, and she can afford monthly payments of $400. If…

A: A study that proves that the 1value of money today is higher than the future value of money is term…

Q: Derek decides to buy a new car. The dealership offers him a choice of paying $588.00 per month for 5…

A: A purchase can be made by paying in cash or paying in installments.

Q: A couple with a newborn baby needs a new vehicle. They take out a $29,000.00 car loan at 8.9%…

A: Given: A couple with a newborn baby needs a new vehicle. They take out a $29,000.00 car loan at 8.9%…

Q: You wish to buy your first home. Your annual gross income is $84,000. You also have monthly payments…

A: Mortgage loans are given on the basis of monthly income and other expenses related to the housing…

Q: You decide that you need $47,000 in 3 years to make a down payment on a house. You plan to make…

A: Since you have asked multiple questions, we will solve the first question for you. If you want any…

Q: If Sam can afford payments at $390 per month for 6years. what is the price of a car that she can…

A: Here, Monthly Payment (PMT) is $390 Time Period (n) is 6 years Interest Rate (r) is 6.6% Payment…

Q: Sarah negotiated a price of $24,800.00 for a new Toyota Camry Hybrid Sedan. She is prepared to give…

A: Price of Sedan = $24,800Down Payment Rate = 15%Compound = Monthly = 12Time = t = 5 * 12 = 60Interest…

Q: John is looking for a new car. He has a down payment of $1,750.00 and wants to pay $300.00 per month…

A: A loan refers to a contract where money is borrowed by one party on the promise of future repayment…

Q: Richard just entered a university, and his parents are planning to give him a car upon graduation.…

A: Future value is computed by following formula:-FV = A*(1+r)nwhereFV = future valueA = amount…

Q: Rick wishes to purchase a new car and can afford monthly payments of up to $275 per month. Finance…

A: Time value tells the value received today by an individual is of more worth than the exact amount…

Q: A friend of yours bought a new sports car with a $4,500 down payment plus a $27,000 car loan that is…

A:

Q: My daughter wants to buy a new car. Here are the parameters. The car cost $12,000 with terms of 5%…

A: While taking a loan for any purpose one should evaluate the payment schedule where the requirement…

Q: Dolph can afford a monthly car payment of $418 for the next 5 years, with the first payment…

A: It is a case where the amount of loan to be borrowed by Dolph is to be calculated, based on his…

Q: Arnold has determined that he can afford a monthly payment of $325 for a car. If he can obtain a 4…

A: Here, Affordable Monthly Payment (PMT) is $325 Time Period in years (n) is 4 years Interest Rate (r)…

Q: 10.) Jojuan wants to buy a used for 12,000 dollars but can only afford 200 dollars. What interest…

A: The amount for which a loan is taken is known as the loan amount or the principal amount. A lender…

Q: Judy has $2,000 for a down payment on a vehicle, and she can afford monthly payments of $400. If…

A: The maximum amount Judy can pay for the vehicle is the sum of downpayment and car loan.  Given the…

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.