QUESTION 19 Joe Smith has $80.000 in student loans. His bank charges 7% APR (compounded monthly) If Joe wants to pay off his student loans in 8 years, calculate the amount he must pay monthly to eliminate the debt. (Round to 2 decimals) QUESTION 20 Joe Smith has $80,000 in student loans. His bank charges 7% APR (compounded monthly). Suppose Joe can only afford to pay $850 per month towards his student loans calculate the number of months it will take to pay off his student loans (Round up to the nearest whole number)

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A: The annuity that can be withdrawn based on the amount that the parents have deposited at 8% interest…

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A:

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A: Hi, there, Thanks for posting the question. As per our Q&A honour code, we must answer the first…

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A: Present value of annuity is the sum of the present value of all the cash flow in the future.

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A: Amount withdrawn each quarter = $3,400Number of years = 4 yearsInterest rate per quarter = 0.56%

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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.