Single-payment loan repayment Personal Finance Problem A person borrows $370 that he must repay in a lumpsum no more than 8 years from now. The interest rate is 6.9% annually compounded. The borrower can repay theloan at the end of any earlier year with no prepayment penalty.a. What amount will be due if the borrower repays the loan after 1 year?b. How much would the borrower have to repay after 4 years?c. What amount is due at the end of the eighth year?

Single-payment loan repayment Personal Finance Problem A person borrows $370 that he mus sum no more than 8 years from now. The interest rate is 6.9% annually compounded. The borrower loan at the end of any earlier year with no prepayment penalty. a. What amount will be due if the borrower repays the loan after 1 year? b. How much would the borrower have to repay after 4 years? c. What amount is due at the end of the eighth year?

Single-payment loan repayment Personal Finance Problem A person borrows $370 that he mus sum no more than 8 years from now. The interest rate is 6.9% annually compounded. The borrower loan at the end of any earlier year with no prepayment penalty. a. What amount will be due if the borrower repays the loan after 1 year? b. How much would the borrower have to repay after 4 years? c. What amount is due at the end of the eighth year?

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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Amortizing Loan Consider a 4-year amortizing loan. You borrow $351,000 initially, and repay it in four equal annual year-end payments. a. If the interest rate is 4.55%, calculate the annual payment. (Do not round intermediate calculations. Round your answer to 2 decimal places.) Annual payment b. Prepare an amortization schedule. (Leave no cells blank - be certain to enter "0" wherever required. Do not round intermediate calculations. Round your answers to 2 decimal places.) Time 0 Loan Balance Year-End Interest Due on Balance Year-End Payment Amortization of Loan $ $ $ $ 1234
Savings Plan Suppose you deposit $450 monthly into an account for seventeen years. The account has an APR of 4.2% compounded monthly. a. Find the ending balance (after 17 years). Answer: $ _____________ b. How much of the ending balance is money you deposited? (HINT: Find the total deposits.) Answer: $ _____________ c. How much of the ending balance is interest? (Use your rounded answer to part a.) Answer: $ _____________
1 Borrow $178,000 at 5.25% for 30 years 2 Borrow $178,000 at 4.00% for 15 years What are the 2 payments? How much interest is paid out under each loan? How much is saved with the 15 year note? And, where does the saved interest end up?
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1 You borrow money on a self liquidating installment loan (equal payments at the end of each year, each payment is part principal part interest) $992,000 17.4% 43 years January 1, 2021 Use the installment method - not straight line Do NOT round any interrmediate numbers. Do NOT turn this into a monthly problem. Do NOT put in minus signs, answer all positive numbers. Loan amount Interest Rate Life Date of Loan Required: 1. What is the annual payment (round to the nearest $)? $4 2. What are the total interest payments (round to the nearest $)? $. 3. After 16 payments have been made, what percentage of the total interest has been paid (round to the nearest percentage point)? 1% 4. After 16 payments have been made, what percentage of the total principal has been paid (round to the nearest percentage polint)? 1%
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Time to repay installment loan Personal Finance Problem Mia Salto wishes to determine how long it will take to repay a $18,000 loan given that the lender requires her to make annual end-of-year installment payments of $3,379. a. If the interest rate on the loan is 14%, how long will it take for her to repay the loan fully? b. How long will it take if the interest rate is 11%? c. How long will it take if she has to pay 18% annual interest? d. Reviewing your answers in parts a, b, and c, describe the general relationship between the interest rate and the amount of time it will take Mia to repay the loan fully. a. If Mia can borrow at an annual interest rate of 14%, the amount of time it will take for her to repay the loan fully is years. (Round to two decimal places.) C
M7
The total monthly payment for a home mortgage loan isaffected by the property tax and insurance. This amount isaround 15% of the principal plus interest payment that youcalculated in the previous problem. Moreover, as a rule ofthumb, a family should not devote more than 28% of itsgross income for home loan payments. With this information,find the amount that a family must earn to afford a$200,000 mortgage loan using the APRs of the previousproblem.
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Annuities use formula for annuities Jose regularly deposits a certain amount K in a bank account which credits compound interest:If Jose, instead, intends to pay K at the beginning of each quarter for 4 years, how much should be this periodic payment if the sum of present values of all these payments is 15,000 at a nominal interest rate of 8% compoundedquarterly?

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