While buying a new car, Monica made a down payment of $900 and agreed to make month-end payments of $240 for the next 4 years and 8 months. She was charged an interest rate of 4% compounded semi-annually for the entire term. a. What was the purchase price of the car? Round to the nearest cent b. What was the total amount of interest paid over the term? Round to the nearest cent

While buying a new car, Monica made a down payment of $900 and agreed to make month-end payments of $240 for the next 4 years and 8 months. She was charged an interest rate of 4% compounded semi-annually for the entire term. a. What was the purchase price of the car? Round to the nearest cent b. What was the total amount of interest paid over the term? Round to the nearest cent

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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Fritz Benjamin buys a car costing $7900. He agrees to make payments at the end of each monthly period for 5 years. He pays 9.6% interest, compounded monthly. (a) What is the amount of each payment? (b) Find the total amount of interest Fritz will pay. (a) Fritz's monthly payment is $ (Round to the nearest cent as needed.) (b) Fritz will pay a total of $ in interest. (Round to the nearest cent as needed.)
Anthony planned to buy a house but could afford to pay only $9,000 at the end of every 6 months for a mortgage with an interest rate of 5.70% compounded semi-annually for 25 years. She paid $30,000 as a down payment. a. What was the maximum amount she could afford to pay for a house? b. What was her total amount spent for the house through the mortgage period including the down payment (not taking the time-value of money into account)? c. What was the total amount of interest paid through the mortgage period?
Kelsey planned to buy a house but could afford to pay only $12,500 at the end of every 6 months for a mortgage with an interest rate of 5.40% compounded semi-annually for 20 years. He paid $27,750 as a down payment. a. What was the maximum amount he could afford to pay for a house? Round to the nearest cent b. What was his total amount spent for the house through the mortgage period including the downpayment (not taking the time-value of money into account)? Round to the nearest cent c. What was the total amount of interest paid through the mortgage period?
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Theresa borrowed $7258.00 compounded monthly to help finance her education. She contracted to repay the loan in monthly payments of $265.00 each. If the payments are due at the end of each month and interest is 4% coumpunded monthly, how long will Theresa have to make monthly payments? State your answer in years and months (from 0 to 11 months). theresa will have to make payments for _____ year(s) and ______ month(s)

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