Problem 4-51 Calculating Annuities Due You want to lease a set of golf clubs from Pings Ltd. The lease contract is in the form of 36 equal monthly payments at an APR of 8.5 percent compounded monthly. Because the clubs cost $3,200 retail, the company wants the value today of the lease payments to equal $3,200. Suppose that your first payment is due immediately. What will your monthly lease payments be? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) Lease payment

Problem 4-51 Calculating Annuities Due You want to lease a set of golf clubs from Pings Ltd. The lease contract is in the form of 36 equal monthly payments at an APR of 8.5 percent compounded monthly. Because the clubs cost $3,200 retail, the company wants the value today of the lease payments to equal $3,200. Suppose that your first payment is due immediately. What will your monthly lease payments be? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) Lease payment

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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Question 12 of 12 You decide to lease a new BMW automobile. The vehicle costs $47,000 new and you are required to pay all taxes and an additional $7,000 (down payment) at the beginning of the lease. The lease payments are $620 per month at the end of the month for three years and you know the lease company charges interest at 5% compounded monthly. (Accrued interest is rounded to the nearest penny at each payment) a. What is the residual value of the car after three years? Round to the nearest cent b. How much interest do you pay over the life of the lease? Round to the nearest cent c. How much principal do you pay in the third year of the lease? Round to the nearest cent
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QUESTION 39 On January 1, 2020, ABC Company signed a three-year lease for the acquisition of equipment. Monthly lease payments of $2,000, based on an annual interest rate of 12% are to be made every January 1, beginning with January 1, 2020. Compute the present value of the minimum lease payments for ABC Company for the capital lease. Following are appropriate factors from tables: Table % / n Present Value of annuity due $1 Present Value of ordinary annuity of $1 Present value of $1 12%/3 2.69005 2.40183 .07379 1%/36 30.40858 30.10751 .69892 $72,000 $60,215.02 $60,817.16 $71,512.41
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Level 2 Chapter 14 - Section I - Exercise 15 Ben and Mal Scott plan to buy a home for $272,900. They will make a 10% down payment and qualify for a 25-year, 7% mortgage loan. a. What is the amount of their monthly payment? Home price = Percent down = Amount financed = Number of 1000s financed = 7%, 25-year table factor = Monthly payment = b. How much interest will they pay over the life of the loan? Number of payments = Total interest =
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3. Lease Analysis You have an office building with a 25,000 sf vacancy. You have two proposals: Tenant A 25,000 Starting Base Rent $48.00 NNN Size Annual Increases: Term: Free Rent: TI Allowance: 3% 10 years 4 months (Base Rent only) $100 psf Tenant B 25,000 $40.00 NNN $1.00/sf/yr 10 years None $25 psf Start Date: 10/1/2024 10/1/2024 Assume there is no parking revenue or moving allowances and that first year opex is $16.00 psf. Also pls assume commissions are $1/sf/yr for outside broker and $0.50/sf for inside broker. Using the lease analysis tool, please calculate the NPV for each. If the owner was considering selling the building in 3 years, please calculate the Capitalized Lease Value psf; assume a 7% cap rate If the owner is a long term holder, which lease would they prefer? If they prefer to sell after 3 years, which would they prefer? Why?
Question Help 5.5.15 A $244,500 mortgage for 15 years for a new home is obtained at the rate of 8.9% compounded monthly. Find (a) the monthly payment, (b) the interest in the first payment, (c) the principal repaid in the first payment, and (d) the finance charge. (a) The monthly payment on the mortgage is $ (Round the final answer to two decimal places as needed. Round all intermediate values to six decimal places as needed.)
Problem 6-10 A borrower is making a choice between a mortgage with monthly payments or biweekly payments. The loan will be $200,000 at 6 percent interest for 20 years. Required: a. What would be the maturity period if payments are bi-weekly? How much will the borrower pay in total under each payment option? Which choice would be less costly to the borrower? b. Assume that the bi-weekly loan was available for 575% What would be the maturity period if payments are bi-weekly? How much will the borrower pay in total under each payment option? Which choice would be less costly to the borrower? Complete this question by entering your answers in the tabs below. Required A Required B What would be the maturity period if payments are bi-weekly? How much will the borrower pay in total under each payment option? Which choice would be less costly to the borrower? (Do not round intermediate calculations. Round your final answers to 2 decimal places.) Maturity period Total monthly payments Total…
Problem 5-10 A floating rate mortgage loan is made for $160,000 for a 30-year period at an initial rate of 12 percent interest. However, the borrower and lender have negotiated a monthly payment of $1,280. Required: a. What will be the loan balance at the end of year 1? b. If the interest rate increases to 13 percent at the end of year 2, how much is the payment plus negative amortization in year 2 and year 5 if the payment remains at $1,280? Complete this question by entering your answers in the tabs below. Required A Required B If the interest rate increases to 13 percent at the end of year 2, how much is the payment plus negative amortization in year 2 and year 5 if the payment remains at $1,280? Note: Do not round intermediate calculations. Round your final answers to 2 decimal places. Loan balance in year 2 Interest accrued - Year 2 Interest accrued - Years 2 - Year 5
Problem 5-10 A floating rate mortgage loan is made for $180,000 for a 30-year period at an initial rate of 12 percent interest. However, the borrower and lender have negotiated a monthly payment of $1,440. Required: a. What will be the loan balance at the end of year 1? b. If the interest rate increases to 13 percent at the end of year 2, how much is the payment plus negative amortization in year 2 and year 5 if the payment remains at $1,440? Complete this question by entering your answers in the tabs below. Required A Required B Answer is not complete. What will be the loan balance at the end of year 1? Note: Do not round intermediate calculations. Round your final answer to 2 decimal places. $ 178,103.48 X Loan balance

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