Shen is taking out an amortized loan for $75,000 to open a small business and is deciding between the offers from two lenders. He wants to know which one would be the better deal over the life of the small business loan, and by how much. Answer each part. Do not round intermediate computations, and round your answers to the nearest cent. If necessary, refer to the list of financial formulas. (a) His credit union has offered him a 9-year small business loan at an annual interest rate of 10.2%. Find the monthly payment. (b) An online lending company has offered him a 10-year small business loan at an annual interest rate of 10.4%. Find the monthly payment. (c) Suppose Shen pays the monthly payment each month for the full term. Which lender's small business loan would have the lowest total amount to pay off, and by how much? O Credit union The total amount paid would be $ less than to the online lending company. O Online lending company The total amount paid would be $ less than to the credit union.
Shen is taking out an amortized loan for $75,000 to open a small business and is deciding between the offers from two lenders. He wants to know which one would be the better deal over the life of the small business loan, and by how much. Answer each part. Do not round intermediate computations, and round your answers to the nearest cent. If necessary, refer to the list of financial formulas. (a) His credit union has offered him a 9-year small business loan at an annual interest rate of 10.2%. Find the monthly payment. (b) An online lending company has offered him a 10-year small business loan at an annual interest rate of 10.4%. Find the monthly payment. (c) Suppose Shen pays the monthly payment each month for the full term. Which lender's small business loan would have the lowest total amount to pay off, and by how much? O Credit union The total amount paid would be $ less than to the online lending company. O Online lending company The total amount paid would be $ less than to the credit union.
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
Related questions
Question
100%
![Shen is taking out an amortized loan for $75,000 to open a small business and is deciding between the offers from two lenders.
He wants to know which one would be the better deal over the life of the small business loan, and by how much.
Answer each part. Do not round intermediate computations, and round your answers to the nearest cent.
If necessary, refer to the list of financial formulas.
(a) His credit union has offered him a 9-year small business loan at an annual interest rate
of 10.2%. Find the monthly payment.
(b) An online lending company has offered him a 10-year small business loan at an annual
interest rate of 10.4%. Find the monthly payment.
(c) Suppose Shen pays the monthly payment each month for the full term. Which lender's
small business loan would have the lowest total amount to pay off, and by how much?
O Credit union
The total amount paid would be $
less than to the online lending company.
Online lending company
The total amount paid would be $| less than to the credit union.
24](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F11aa15ac-70f1-467d-87fe-427c9c2dd80e%2F3f2ccc03-747e-40c2-a900-4ff1050cb5f1%2F7p7qf6b_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Shen is taking out an amortized loan for $75,000 to open a small business and is deciding between the offers from two lenders.
He wants to know which one would be the better deal over the life of the small business loan, and by how much.
Answer each part. Do not round intermediate computations, and round your answers to the nearest cent.
If necessary, refer to the list of financial formulas.
(a) His credit union has offered him a 9-year small business loan at an annual interest rate
of 10.2%. Find the monthly payment.
(b) An online lending company has offered him a 10-year small business loan at an annual
interest rate of 10.4%. Find the monthly payment.
(c) Suppose Shen pays the monthly payment each month for the full term. Which lender's
small business loan would have the lowest total amount to pay off, and by how much?
O Credit union
The total amount paid would be $
less than to the online lending company.
Online lending company
The total amount paid would be $| less than to the credit union.
24
Expert Solution
![](/static/compass_v2/shared-icons/check-mark.png)
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 2 steps with 2 images
![Blurred answer](/static/compass_v2/solution-images/blurred-answer.jpg)
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, finance and related others by exploring similar questions and additional content below.Recommended textbooks for you
![Essentials Of Investments](https://compass-isbn-assets.s3.amazonaws.com/isbn_cover_images/9781260013924/9781260013924_smallCoverImage.jpg)
Essentials Of Investments
Finance
ISBN:
9781260013924
Author:
Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:
Mcgraw-hill Education,
![FUNDAMENTALS OF CORPORATE FINANCE](https://www.bartleby.com/isbn_cover_images/9781260013962/9781260013962_smallCoverImage.gif)
![Financial Management: Theory & Practice](https://www.bartleby.com/isbn_cover_images/9781337909730/9781337909730_smallCoverImage.gif)
![Essentials Of Investments](https://compass-isbn-assets.s3.amazonaws.com/isbn_cover_images/9781260013924/9781260013924_smallCoverImage.jpg)
Essentials Of Investments
Finance
ISBN:
9781260013924
Author:
Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:
Mcgraw-hill Education,
![FUNDAMENTALS OF CORPORATE FINANCE](https://www.bartleby.com/isbn_cover_images/9781260013962/9781260013962_smallCoverImage.gif)
![Financial Management: Theory & Practice](https://www.bartleby.com/isbn_cover_images/9781337909730/9781337909730_smallCoverImage.gif)
![Foundations Of Finance](https://www.bartleby.com/isbn_cover_images/9780134897264/9780134897264_smallCoverImage.gif)
Foundations Of Finance
Finance
ISBN:
9780134897264
Author:
KEOWN, Arthur J., Martin, John D., PETTY, J. William
Publisher:
Pearson,
![Fundamentals of Financial Management (MindTap Cou…](https://www.bartleby.com/isbn_cover_images/9781337395250/9781337395250_smallCoverImage.gif)
Fundamentals of Financial Management (MindTap Cou…
Finance
ISBN:
9781337395250
Author:
Eugene F. Brigham, Joel F. Houston
Publisher:
Cengage Learning
![Corporate Finance (The Mcgraw-hill/Irwin Series i…](https://www.bartleby.com/isbn_cover_images/9780077861759/9780077861759_smallCoverImage.gif)
Corporate Finance (The Mcgraw-hill/Irwin Series i…
Finance
ISBN:
9780077861759
Author:
Stephen A. Ross Franco Modigliani Professor of Financial Economics Professor, Randolph W Westerfield Robert R. Dockson Deans Chair in Bus. Admin., Jeffrey Jaffe, Bradford D Jordan Professor
Publisher:
McGraw-Hill Education