You have a 20,000 loan at 7.2% annually for 8 years. You agree to pay the principal in level installments of 2,500 per year, and to pay interest on the outstanding balance each year. Find the interest due and the total payment at time 6.

Q: Compute the compound amount and the interest on a loan of $10,600 compounded annually for six years…

A: Given: Loan = $10,600 Interest rate = 8% Years = 6

Q: A $5000 loan at 10% compounded annually is to be repaid by two payments three and five years from…

A: Loan amount = $5000First payment = $3000Required rate of return =9%To find: The purchase price for…

Q: Find the exact interest on a loan of ​$6000 at 8​% annually for  50 days.

A: Principal loan amount = 6000Number of days = 50Interest rate = 8%/100 = 0.080000 in decimalTotal…

Q: A $15 000.00 loan requires payments at the end of each month for five years. If the interest rate on…

A: Present value of annuity formula.PV = A*wherePV = present value of annuityA= periodic paymentsr=…

Q: Determine the monthly payment if you take out a loan for $ 220000 with an annual interest rate of 9%…

A: Given information: Loan amount is $220,000 Annual interest rate is 9% Number of years is 15 years

Q: A loan of $10,000 today is to be repaid by annual payments of $800 to commence one year from now and…

A: Final payment:The "final payment" represents the concluding installment in a series of financial…

Q: Calculate the present value of a loan that could be cleared by payments of $3,250 at the end of…

A: We need to use present value of ordinary annuity formula to calculate the loan amount for given…

Q: You deposit 2,000 in an account that pays 7% interest compounded semiannually.after two years the…

A: The concept of time value of money will be used here. Money deposited today gets computed and hence…

Q: You borrow $5000 at 10% per year and will pay off the loan in 3 equal annual payments starting one…

A: Calculation of Payment at the end of Year 2:The interest payment is $348.94 and principal payment is…

Q: A payment of $500 is made at the end of each month for three years to a savings account. The…

A: Present value method is used to evaluate the different level of investment projects. With the help…

Q: You deposit $64000 into an account which pays 5% compounded monthly. You wish to make semiannual…

A: Amount that can be withdrawn from account depends on the period of withdrawal and interest rate of…

Q: loan is found to have an initial installment payment of IDR 2,500,000, and there are still 9…

A: initial installments =2500000 Remaining instalments =9 growth in instalments =3% interest rate =7%

Q: A bank makes a loan of $10,000. The loan will be paid back after 10 years with yearly payments of…

A: When the borrower borrows a loan from the lender, he has to pay a rate of interest on the borrowed…

Q: A loan of $10200 is to be amortized with quarterly payments over five years.  The interest on the…

A: Amortization of a loan refers to the process of gradually paying off the loan debt over a specific…

Q: To borrow $600, you are offered an add-on interest loan at 9 percent. Two loan payments are to be…

A: Given: Borrowed amount =$600Annual interest =9%   Amount to be paid =Principal + Interest=$600 +…

Q: Find the monthly payment for the loan indicated. (Round your final answer to two decimal places.)…

A: Formula to calculate EMI:  EMI= (P X R/12) X [(1+R/12) ^N] / [(1+R/12) ^N-1] Wherein:  P = Loan…

Q: Calculate the present value of a loan that could be cleared by payments of $3,350 at the end of…

A: Here,Semi Annual Payments (PMT) is $3,350Time Period (n) in years is 7 yearsInterest Rate (r) is…

Q: Determine the monthly payment if you take out a loan for $ 180000 with an annual interest rate of…

A: Loan amount (PV) = $180,000 Interest rate = 8.25% Monthly interest rate (r) = 0.0825/12 = 0.006875…

Q: How much interest would you be paying in the 75th month?

A: Amortization is the process of repaying the loan over time. In an amortizing loan, a portion of each…

Q: You plan to deposit $5, 706 into a savings account paying 8% interest compounded quarterly. How much…

A: whereFV = Future value = amount at the endPV = Present value = amount deposited today = $5,706i =…

Q: You take out $17,300 loan that will be paid off in six equal installments. The stated annual…

A: APR can be referred to as the effective interest rate that takes into account the amount of the loan…

Q: Taking out a 21 year loan at $59,000 with 6% APR compounded monthly, and with monthly payments,…

A: Therefore, second principal payment is $117.9.

Q: You have taken out a 20-year loan of $72,000 with 3% interest (APR) compounded monthly and with…

A: Annual percentage rate (APR) is a rate that a person is paying annually after undertaking all the…

Q: A finance company uses the discount method of calculating interest. The loan principal is $5,000,…

A: Future Value = Present Value * (1+r)^n

Q: You deposit $4000 in an account that pays 6% interest compounded semiannually. After 3 years, the…

A: Compound interest is interest computed on both the initial principal amount and any accrued interest…

Q: You currently have a balance of $9,000 and you pay an interest rate of 17% per year on the card.…

A: The outstanding balance is $9,000The interest rate is 17% per yearThe minimum payment is 3%The time…

Q: You have taken out a 30-year loan of $55,000 with 6% interest (APR) compounded monthly and with…

A: An amount or asset borrowed by an entity from an individual or financial institution is known as a…

Q: Find the interest paid on a 30-year loan of $350,000 at an annual interest rate of 6% compounded…

A: Monthly payments are made to amortize a loan taken. It includes a principal repayment and interest…

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.