You are the loan department supervisor for a bank. This installment loan is being paid off early, and it is your task to calculate the rebate fraction, the finance charge rebate (in $),and the payoff for the loan (in $). (Round dollars to the nearest cent.)Amount Number ofFinanced Payments$1,70018MonthlyPayment$125.89PaymentsMade13RebateFractionFinanceChargeRebateLoanPayoff

Rebate fraction is a fraction that is a widely accepted method for calculating the finance charge…

Answered: You are the loan department supervisor…

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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A borrower has two alternatives for a loan: (1) issue a $570,000, 90-day, 7% note or (2) issue a $570,000, 90-day note that the creditor discounts at 7%. Assume a 360-day year. This information has been collected in the Microsoft Excel Online file. Open the spreadsheet, perform the required analysis, and input your answers in the questions below. X Open spreadsheet a. Compute the amount of the interest expense for each option. Round your answer to the nearest dollar. for each alternative. b. Determine the proceeds received by the borrower in each situation. Round your answers to the nearest dollar. (1) $570,000, 90-day, 7% interest-bearing note: $ (2) $570,000, 90-day note discounted at 7%: $ c. Alternative is more favorable to the borrower because the borrower
Enter your dollar answers rounded to the nearest two cents and precede numbers that are less than zero (0) with a minus sign (–).) Buy On Time or Pay Cash Cost of Borrowing 1. Terms of the loan a. Amount of the loan $10,000.00 b. Length of the loan (in years) 5 c. Monthly payment $188.70 2. Total loan payments made ($ per month months) $ 3. Less: Principal amount of the loan $ 4. Total interest paid over life of loan $ 5. Tax considerations: – Is this a home equity loan? no – Do you itemize deductions on your federal tax return? yes 6. What federal tax bracket are you in? 35% 7. Taxes saved due to interest deductions ($ x %) $ 8. Total after-tax interest cost on the loan $ Cost of Paying Cash 9. Annual interest earned on savings (6% x ) $ 10. Annual after-tax interest earnings ($ x %) $ 11. Total after-tax interest earnings…
Suppose you secure a home improvement loan in the amount of $5,000 from a local bank. The loan officer gives you the following loan terms:• Contract amount = $5,000• Contract period = 24 months• Annual percentage rate = 12%• Monthly installment = $235 .37Shown is the cash flow diagram for this loan. Construct the loan payment schedule by showing the remaining balance, interest payment, and principal payment at the end of each period over the life of the loan.
You are the loan department supervisor for a bank. This installment loan is being paid off early, and it is your task to calculate the rebate fraction, the finance charge rebate (in $), and the payoff for the loan (in $). (Round dollars to the nearest cent.) AmountFinanced Number ofPayments MonthlyPayment PaymentsMade RebateFraction FinanceChargeRebate LoanPayoff $1,900 18 $126.89 13 $ $
Need help with following questions 1,2,3,4,5
You are the loan department supervisor for a bank. This installment loan is being paid off early, and it is your task to calculate the rebate fraction, the finance charge rebate (in $), and the payoff for the loan (in $). (Round dollars to the nearest cent.) AmountFinanced Number ofPayments MonthlyPayment PaymentsMade RebateFraction FinanceChargeRebate LoanPayoff $4,700 36 $162.33 31 $ $
Jami's Home Repair borrows $6,000, at 13.75% interest, for 330 days. Use the exact interest method to find the amount of interest that the bank will collect. (Round to the nearest cent.) Ⓒ$600.00 Ⓒ$640.00 $745.89 Ⓒ$8,200.00
← Use PMT- to determine the regular payment amount, rounded to the nearest dollar. Your credit card has a balance of $3600 and an annual interest rate of 16% With no further 1- purchases charged to the card and the balance being paid off over three years, the monthly payment is $127, and the total interest paid is $972. You can get a bank loan at 8.5% with a term of four years. Complete parts (a) and (b) below. a. How much will you pay each month? How does this compare with the credit card payment each month? Select the correct choice below and fill in the answer boxes to complete your choice. (Do not round until the final answer. Then round to the nearest dollar as needed) This is 5 A. The monthly payments for the bank loan are approximately $ OB. The monthly payments for the bank loan are approximately $ This is 5 less than the monthly credit card payments more than the monthly credit card payments
You have just been hired as a loan officer at a national bank. Your first assignment is to calculate the amount of the periodic payment (in $) required to amortize (pay off) the following loan being considered by the bank (use Table 12-2). (Round your answer to the nearest cent.) Payment Period Nominal Rate (%) Loan Term of Present Value Payment Loan (years) (Amount of Loan) every month 6 $40,000 4 %24
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