hours will the bacteria count be 32 000?-ial. Checkechnology.1 place.10. Simionie needs $7000 to buy asnowmobile, but only has $6000. His bankoffers a GIC that pays an annual interest1.1*rate of 3.93%, compounded annually. Howlong would Simionie have to invest hismoney in the GIC to have enough moneyto buy the snowmobile?1.08*+2answers toгу.Did You Know?= 25(3)A Guaranteed Investment Certificate (GIC) is a secureinvestment that guarantees 100% of the original= 4'amount that is invested. The investment earnsinterest, at either a fixed or a variable rate, basedon a predetermined formula.1 = 4'-2Extend15. a) Solve each inequality.rns interest at a rateunded quarterly.ii) 81* < 272x+1

Future Value: The future value is the amount that will be received at the end of a certain period.…

- Simionie needs $7000 to buy a snowmobile, but only has $6000. His bank offers a GIC that pays an annual interest rate of 3.93%, compounded annually. How long would Simionie have to invest his money in the GIC to have enough money to buy the snowmobile?

- Simionie needs $7000 to buy a snowmobile, but only has $6000. His bank offers a GIC that pays an annual interest rate of 3.93%, compounded annually. How long would Simionie have to invest his money in the GIC to have enough money to buy the snowmobile?

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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6) Susan is looking to purchase her first home five years from today. The house costs $1,550,000. She will have to make a down payment of 10% of this amount and plans to take a loan from the bank for the difference. Bank charges are approximately 15% of the loan amount. She plans to start saving from today to cover both the down payment and the bank charges. a. How much will she need to save to cover both the down payment and bank charges? b. If she currently has $195,000 in her account and will make no further deposits over the next five years, what rate of interest must she earn on this account in order to achieve the savings target calculated in part (a) above?
Larry Mager purchased a ski lodge in Telluride for $850,000. His bank is willing to finance 70% of the purchase price. As part of the mortgage closing costs, Larry had to pay 4 1/4 discount points. How much did this amount to?
Tom needs a car to commute to work and has found a suitable Honda Civic from a dealer for $8000. He has $3000 saved for it and can afford a monthly payment up to $250. Which of the following is the best (lowest total cost) financing option for him? O a. Make a $3000 deposit and take a two year loan with monthly payments of $221. O b. Make a $2000 deposit and take a three year loan with monthly payments of $185. O c. Make a $2500 deposit and take a two year loan with monthly payments of $241. O d. Make a $1000 deposit and take a three year loan with monthly payments of $210.
Tristan Sandino is selling his motorcycle. His friend, Rudy, is offering to pay cash in the amount of $8,800. Another friend, Costa, has offered payments of $300 monthly for 4 years. What is the present value of Costa's payments? Assume money is worth 3.5%, compounded monthly.
Kathy wants to buy a condominium selling for $95,000. The taxes on the property are$1500 per year, and homeowners' insurance is $336 per year. Kathy's gross monthly income is$4000. She has 15 monthly payments of $135 remaining on her van. The bank is requiring 20% down and is charging a 9.5% interest rate with no points. Her bank will approve a loan that has a total monthly mortgage payment of principal, interest, property taxes, and homeowners' insurance that is less than or equal to 28% of her adjusted monthly income. (a) Determine the required down payment. (b) Determine 28% of her adjusted monthly income. (c) Determine the monthly payment of principal and interest for a 25-year loan. (d) Determine her total monthly payment, including homeowners' insurance and taxes. (e) Does Kathy qualify for the loan? (f) Determine how much of the first payment on the mortgage is applied to the principal. (g) Determine the total amount she pays for the condominium with a 25-year conventional loan.…
Derek decides to buy a new car. The dealership offers him a choice of paying $518.00 per month for 5 years (with the first payment due next month) or paying some $28,412.00 today. He can borrow money from his bank to buy the car. What interest rate makes him indifferent between the two options? Submit
Jasmine purchased a home in San Francisco near her best friend Sallie. The purchase price of the home was $ 2,000,000. However, Jasmine only financed 80% of the home value as she was able to secure the $400,000 down payment to help lower her monthly payments. What is her monthly payment if she financed at today's rate of 7.55% for a 15-year mortgage?
Rachel purchased a car for $17,500 three years ago using a 4-year loan with an interest rate of 10.8 percent. She has decided that she would sell the car now, if she could get a price that would pay off the balance of her loan. What is the minimum price Rachel would need to receive for her car? Calculate her monthly payments, then use those payments and the remaining time left to compute the present value (called balance) of the remaining loan.
Lashonda wants to buy a new house but needs money for the down payment. Her parents agree to lend her money at an annual rate of 2%, and charged a simple interest. They lend her $6000 for 3 years. She makes no payments except the one at the end of that time. a) how much total interest will lashonda have to pay? b) what will the total repayment amount be (including interest)?
Sam can afford to spend $500 per month on a car. He figures he needs half of it for gas, parking, and insurance. He has been to the bank, and they will loan him 100% of the car’s purchase price. (Note: If he had a down payment saved, then he could borrow at a lower rate.) (a) If his loan is at a nominal 12% annual rate over 36 months, what is the most expensive car he can purchase? (b) The car he likes costs $14,000 and the dealer will finance it over 60 months at 12%. Can he afford it? If not, for how many months will he need to save his $500 per month? (c) What is the highest interest rate he can pay over 60 months and stay within his budget if he buys the $14,000 car now?
Max wants to buy a house, to put on his lot, to hold his giant cheese refrigerator. Max buys a$2,000,000 house and makes a $500,000 down payment. Themortgage is for 30 years at 4% compounded monthly. The first payment will be made one month after thepurchase of the house.a) How much are Max’s monthly payments?b) How much of the 300the payment goes to the principal and how much goes to interest? TVM FORMULA
Bill needs a new car and can afford monthly car payments of $400. The interest rate on new car loans is 7% APR and payments are made at month end. Bill wonders whether to arrange a 48 or 60 month loan. With either loan Bill will borrow the maximum amount and buy the most expensive car possible. The average annual rate of depreciation of a car's value is 18%. Bill can invest his spare cash in a mutual fund expected to pay 5%, Compounded monthly. Bill will keep whichever car he buys for 5 years. a.) What is the maximum he can spend on a car if he arranges a 48 month loan? What if he arranges a 60 month loan? b.) Compare Bill's wealth (the value of his car plus his investments) after 5 years if he arranges a 48 month loan to his wealth if he arranges a 60 month loan.

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