Stephen received a 30 year loan of $225,000 to purchase a house. The interest rate on the loan 4.10% compounded semi-annually. a. What is the size of the monthly loan payment

Q: Michael Sanchez purchased a condominium for $73,000. He made a 20% down payment and financed the…

A: Monthly payment on the loan includes the payment towards principal and interest. From the table…

Q: John purchased a house for $325,000. He made a downpayment of 15% of the value of the house and…

A: A loan is a sort of debt that is taken on by an individual or another institution. The lender, which…

Q: Jesse borrowed from a bank at 5.92% compounded semi-annually; he settled the loan by repaying $3,055…

A: Interest rate is 5.92% compounded semi-annually Amount repaid is $3,055 every 6 month Time period is…

Q: Maria took out a loan for $7900 that charges an annual interest rate of 8.8% compounded quarterly.…

A: n=4 r=8.8/4/100=0.022 present value=7900

Q: Daniel paid $825 simple interest on a $1400 loan for five years . What was the interest rate?

A: Given: Simple Interest =$825Principal amount =$1400Time =5 years

Q: Joshua received a loan of $8,000 at 6.02% compounded semi-annually from a credit union to use as…

A: Working capital represents the liquidity of a company as it shows the difference between the current…

Q: Andrew Bolkonsky borrows $200,000 to purchase a house for investment purposes on January 1st 2006.…

A: The concept of present value states that a sum of money is worth today more than the same sum of…

Q: a. Calculate the size of payments. 0.00 Round to the nearest cent b. Fill in the partial…

A: Monthly payments refer to the specified amount that a borrower is required to repay on a loan each…

Q: Justin is financing S169,600 for a home at 5.25% interest with a 25-year fixed-rate loan. Find the…

A: Using excel pmt function

Q: Michael Sanchez purchased a condominium for $71,000. He made a 20% down payment and financed the…

A: Monthly payment refers to an amount being paid by the borrower to the lender at every month for…

Q: Hannah purchased a house for $475,000. She made a downpayment of 25% of the value of the house and…

A: Monthly payment is the payment made by every month that includes the principal and interest amount.

Q: If Rachel obtained a business loan of $205,000.00 at 4.49% compounded semi-annually, how much should…

A: Present value of annuity Annuity is a series of equal payments at equal interval over a specified…

Q: Dominique has a mortgage of $445,000 through his bank for property purchased. The loan is repaid by…

A: Any sum borrowed to meet any specific personal or business needs is regarded as a mortgage/loan. The…

Q: Owen borrowed $28,500 at 9% compounded monthly to buy a car. The loan will be repaid with equal…

A: The loan schedule gives information to the lender and borrower about the loan payments due and the…

Q: Miracle has a mortgage of $257,000 through her bank for property purchased. The loan is repaid by…

A: The given problem can be solved using =IPMT(rate, per, nper, pv, [fv], [type]) function in excel…

Q: 5. Jenna received a 15 year loan of $375,000 to purchase a 5.10% compounded semi-annually. a. What…

A: Loans are paid by the fixed monthly payments and these payments carry the payment for interest and…

Q: Clara borrows $41,000 today at 2.9% per year compounded quarterly, to start her own buisness. she…

A: Given, Loan amount (p) = $41,000 Interest rate (r) = 2.9% Number of compounding periods (m) = 4…

Q: Lily purchased a boat valued at $19 000 on an installment plan requiring equal monthly payment for…

A:

Q: Corey received a $36,750 loan from a bank that was charging interest at 3.50% compounded…

A: We need to use loan amortization formula below to calculate semi-annual payment.  where P=Loan…

Q: Nick received a loan of $5000 from a bank to purchase a bike. He obtained the loan at an interest…

A: Amortization Schedule: The amortization schedule represents a table consisting of periodic loan…

Q: John Doeber borrowed $125,000 to buy a house. His loan cost was 11% and he promised to repay the…

A: Step 1: Given data :Loan amount (P): $125,000Annual interest rate (r): 11%Amortization period (n):…

Q: What was the size of the periodic payments?

A: First, we need to determine the equivalent interest rate as the loan is compounded monthly, but the…

Q: a) i) Ali is paying off a loan by making $50 payments at the end of every month for 2 years, at 6%,…

A: Loan is a borrowed amount taken for the purpose of completing the shortage of funds. When an…

Q: 11. Max buys a bedroom set for $2500. The dealer gave him a 3-year add-on interest loan at 6.5%…

A: Interest calculated on Original value of a loan is called Simple Interest.

Q: Tarell purchased a car for $54,700; he paid 5% of the cost as a down pay the balance amount at 3.4%…

A: Loans are paid by the equal monthly installments and these carry the payment for principal amount…

Q: Michael Sanchez purchased a condominium for $64,000. He made a 20% down payment and financed the…

A: The company borrows money from another institution or bank and makes regular payments that include a…

Q: To help buy her new condominium, Maria is taking out a $154,000 mortgage loan for 30 years at 3.7%…

A: The loan is a value that is borrowed from external sources like banks and this amount is repaid…

Q: Mr. Joe  takes a loan P amount from the bank. The loan attracts an interest of 1.5% per month…

A: future value = present value×ert where, r=rate of interest t=time in years

Q: Leona Jefferson purchased a home and obtained a 20-year loan of $436,750 at an annual interest rate…

A: A mortgage refers to a covered loan that is borrowed for the purchase of a property which itself…

Q: rate of 7.5% compounded monthly. Find (a) the monthly payment (b) the total interest charges

A: Monthly Payment: These are annuity payments made by the borrower to the lender for taking on a loan.…

Q: To vacation with his family, Mr. Velasco obtains a loan of $60,000 to be paid in 7 monthly…

A: Let's create an amortization table for Mr. Velasco's loan. Here are the details:Loan amount:…

Q: What is the interest paid in the 2nd year of the mortgage?

A: Mortgage refers to a legal contract based upon which a financial institution such as bank grants a…

Q: A couple buys a $190,000 home, making down payment of 16%. The couple finances the purchase with a…

A: Price of the home = $190,000 Down payment = 16% Loan amount (PV) = 190,000*(1-0.16) = $159,600…

Q: Jason takes out a loan at 10% compounded annually for 7 years. At the end of this period, he pays…

A: Interest charged on the principal amount and the interest accrued is known as Compound Interest. It…

Q: Kristina has a mortgage of $575,000 through her bank for property purchased. The loan is repaid by…

A: Formulas:

Q: Gregory purchased a house for $350,000. He made a down payment of 30.00% of the value of the house…

A: Mortgage  A legal agreement between the borrower and a bank in which the bank will take ownership of…

Q: Jason bought a home in Arlington, Texas, for $127,000. He put down 25% and obtained a mortgage for…

A: Price of home = $ 127000 Down payment = 25% Loan amount (PV) = 127000*(1-0.25)…

Q: Jeremy received an excellent interest rate for her loan of $9,500. Calculate the nominal interest…

A: Solution:When an amount is borrowed, it can either be repaid as a lump sum payment or in…

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.