You have taken out a loan to help with college expenses. The interest rate is 0.4% per month. The interest is payable monthly; payment on the principal is deferred until after graduation.  You have just made the first monthly payment of 80. How much did you borrow?

Q: You loan a friend $200 and are repaid $30 at the end of each month for the first 3 months and $120…

A: Rate of return = ( amount received at the end - amount invested) ÷ amount invested.

Q: You took out a loan to buy a new car. The monthly interest rate on the loan is 0.6%. You have to pay…

A: Future value refers to the compounding the future cash flows with the interest rate compounding for…

Q: Today you made a student loan of $10,000 with the 5.5% annual interest rate. You will be in school…

A: A loan refers to a contract between two entities where money is borrowed by one from the other on…

Q: You borrow $500 from a family member and agree to pay it back in six months. Because you are part of…

A: Principal amount borrowed (P) = $500Rate of interest (r) = 0.5% per monthTime = 6 months

Q: Suppose that on January 1 you have a balance of $2600 on a credit card whose APR is 13%, which you…

A: Monthly payment refers to an amount that is paid every month for the repayment of loan amount…

Q: Different payment plans can affect the amount of money you need to borrow. a) Ali is paying off a…

A: Note: As per our guidelines, we can only answer one question at once. Since, you haven't…

Q: A bank offers a savings account with a 3% annual interest rate, compounded monthly. Sars wants to…

A: The objective of the question is to find out how much money Sara needs to deposit now in order to…

Q: You have $4,500 on a credit card that charges a 16% interest rate. If you want to pay off the credit…

A: Monthly Payment: Monthly payments let a borrower pay down part of the remaining sum, which is…

Q: Suppose Jorge Otero has set up an annuity due with a certain credit union. At the beginning of each…

A: Future value = Present value ( 1 + rate of interest )Period Future value = Amount deposited * Future…

Q: ou make a one time 2000 deposit into an account which pays an annual interest rate of 1.7 compounded…

A: the final balance in the account will be the future value of the amount 2000 along with the interest…

Q: Suppose Jorge Otero has set up an annuity due with a certain credit union. At the beginning of each…

A: Compound = monthly = 12 Payment = p = $140 Interest rate = r = 6 / 12 = 0.5% Time = t = 15 months

Q: What is the value (in $) of Jorge's account after 16 months? (Round your answer to the nearest…

A: Information Provided: payment made = $150 Term = 16 months Interest rate = 6% compounded monthly

Q: You have credit card debt of $30,000 that has an APR (monthly compounding) of 18%. Each month you…

A: Monthly Interest rate of old card=18%/12=1.5%Interest payment of old card per month=$30000*1.5%=…

Q: You have credit card debt of $30,000 that has an APR (monthly compounding) of 15%. Each month you…

A: In the realm of personal finance, credit cards play a significant role in managing expenditures and…

Q: You have 45 remaining monthly payments of $688 until you pay off your car loan with interest.…

A: In order to find the current balance of the loan today one has to find the Present value of the…

Q: You have just entered college and have decided to pay for your living expenses using a credit card…

A: Solution: An equal amount paid each period is known as annuity. Future value of annuity = PMT x…

Q: ou could earn 3% on your money in your checking account, as long as the minimum balance does not…

A: The cost of checking account is the total cost which one has to bear for not maintaining the minimum…

Q: You ran a little short on your spring break vacation, so you put $2,000 on your credit card. You can…

A: Banks issue credit cards to its customers. The customers use the credit cards for making purchases,…

Q: You owe $1,853.42 on a credit card with a limit of $3,000.00 at a rate of 15.5% APR. You pay…

A: Given : Owe $1,853.42 on a credit card with a limit of $3,000.00 at a rate of 15.5% APR. Pay…

Q: Recently, you made multiple large purchases on your credit card totaling $10,350. The interest rate…

A: Formulas:

Q: A man borrows $60,000 to help pay for his college expenses.  He intends to pay off the loan with…

A: Monthly payment is refer as the regualr amount of fund or payments at monthly time interval. It is…

Q: If you have ATM fees each month of $8 for 4 years, what is the total cost of those banking fees?

A: A cost system is a system that is designed to evaluate the cost incurred by the company.

Q: Your credit card has a balance of $4500 and an interest rate of 22%. The credit card requires a…

A: Credit cards refer to debt instruments that are provided by financial institutions to individuals…

Q: You have $5500 in credit card bills at an annual interest rate of 26%. You have not made a payment…

A: The objective of the question is to calculate the total amount owed on a credit card bill after two…

Q: If a person has ATM fees each month of $22 for 8 years, what would be the total cost of those…

A: Monthly fees: $22Number of years: 8

Q: Imelda opens a savings account with $12,000, which pays an annual interest rate of 7.8%. If she…

A: Future value of the amount that is invested and also amount of interest accumulated over the period…

Q: Heather borrowed $4700 on her credit card to purchase new furniture. Find the monthly interest…

A: The credit card information consists of the credit card number, expiration date, etc. The best thing…

Q: You charged $3,172 on a credit card. If you pay the minimum payment per month of $46.69, you will…

A: Charge of credit card = 3172 Minimum monthly payment = 46.69 N = 96 payments

Q: your credit card has a balance of $4,500 and an annual interest rate of 16%. you decide to pay off…

A: The monthly deposit is calculated by dividing the loan balance with the PVIFA at 1.33% and 36…

Q: Find the monthly payment

A: Introduction: The term loan refers to the amount which is provided by an individual or any financial…

Q: You decide to quit using your credit card and want to pay off the balance of $9,500 in 4 years. Your…

A: The periodic payment is the payment made at regular intervals that have the same amount. The…

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.