You wish to finance the purchase of a boat home for $38,400. A finance company offers an APR of 12% on a 24-month installment loan. After using Table 13-1 from your text to find the finance charge, calculate the monthly payment.
You wish to finance the purchase of a boat home for $38,400. A finance company offers an APR of 12% on a 24-month installment loan. After using Table 13-1 from your text to find the finance charge, calculate the monthly payment.
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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Question
Transcribed Image Text:You wish to finance the purchase of a boat home for $38,400. A finance company offers an APR of 12% on a 24-month installment
loan. After using Table 13-1 from your text to find the finance charge, calculate the monthly payment.
Transcribed Image Text:ANNUAL PERCENTAGE RATE TABLE FOR MONTHLY PAYMENT PLANS
SEE INSTRUCTIONS FOR USE OF TABLES
NUMBER
ANNUAL PERCENTAGE RATE
OF
PAYMENTS 10.00% 10.25% 10.50% 10.75% 11.00% 11.25% 11.50% 11.75% 12.00% 12.25% 12.50% 12.75% 13.00% 13.25% 13.50% 13.75%
(FINANCE CHARGE PER $100 OF AMOUNT FINANCED)
1.67 1.71
2.14
2.64
0.92 0.94 0.96 0.98 1.00 1.02 1.04 1.06 1.08 1.10 1.12 1.15
0.83 0.85 0.87 0.90
1.25 1.28 1.31 1.35 1.38 1.41 1.44 1.47 1.50 1.53 1.57 1.60 1.63 1.66 1.69 1.72
1.76 1.80 1.84 1.88 1.92 1.96 2.01 2.05 2.09 2.13 2.17 2.22 2.26 2.30
2.20 2.25 2.30 2.35 2.41 2.46 2.51 2.57 2.62 2.67 2.72 2.78 2.83 2.88
2.70 2.77 2.83 2.89 2.96 3.02 3.08 3.15 3.21 3.27 3.34 3.40 3.46
3.39 3.45 3.53 3.60 3.68 3.75 3.83
3.90. 3.97 4.05
3.87 3.95 4.04 4.12 4.21 4.29 4.38 4.47 4.55 4.64
4.36 4.46 4.55 4.65 4.74 4.84 4.94 5.03 5.13 5.22
4.85 4.96 5.07 5.17 5.28 5.39 5.49 5.60 5.7L 5.82
5.35 5.46 5.58 5.70 5.82 5.94 6.05 6.17 6.29 6.41
12345
67899
10
11
13
14
16
17
18
19
20
21
2242 2288 228 ****
23
26
27
29
30
31
32
33
35
37
38
39
42
43
48
50
51
52
53
54
55
56
57
58
59
60
2.09
2.51 2.58
3.08
3.16 3.23 3.31
3.53 3.62 3.70 3.78
3.98 4.07 4.17 4.26
4.75
4.43 4.53
5.23
4.76 4.88 4.99
5.11
5.07 5.20 5.33 5.45 5.58 5.71 5.84 5.97 6.10
6.36 6.49
6.23
6.90 7.04
6.48 6.62 6.76
5.50 5.64 5.78 5.92 6.06 6.20 6.34
6.99 7.14 7.29 7.44 7.59
5.93 6.08 6.23 6.38 6.53 6.68 6.84
7.66 7.82 7.99 8.15
7.50
6.85 7,01
6.36 8.52 6.69
7.17 7.34
8.53 8.71
8.36
8.19
7.84 8.01
7.66
7.32
6.80 6.97 7.14
2.94
3.01
3.36 3.45
3.79 3.88
4.21 4.32
4.64
7.23 7.41
7.60
8.06
7.67 7.86
8.31 8.52
8.10
8.76 8.98
8.54
9.21
8.98
7.97
7.78
8.25 8.45
8.73 8.93
9.42
9.20
9.90
9.67
8.15
8.65
9.14
9.64
10.13
11.36
11.12
9.66 9.90 10.15 10.39 10.63 10.88
11.64
9.86 10.12 10.37
11.90
10-62 10.88 11.13 11.39
10.30 10.57 10.84 11.10 11.37 11.63
12.44
11.90 12.17
12.98
11-58
10.75 11.02 11.30
11.86 12.14 12.42 12.70
13.52
12.06 12.35
11.48 11.77
12.64 12.93 13.22
11.19
9.27 9.46 9.64
9.08
9.83 10.02
8.90
8.71
8.53
8.34
10.03 10.73
9.63
10.43
9.83
10.63
9.24 9.44
8.84 9.04
10.61 10.82 11.03 11.24
10.19 10.40
9.98
9.77
9.56
9.35
11.18 11.41 11.63 11.85
10.74 10.96
10.30 10.52
9.86 10.08
11.76 12.00
11.06 11.30 11.53
12.23 12.46
10.83
10.37 10.60
11.64 11.94
15.59 15.89 16.20
14.97 15.28
15.56 15.87 16.19 16.51 16.83
16.47 16.80 17.13 17.46
17.07 17.41 17.75 18.10
17.66
18.38 18.74
18.02
12.10 12.34 12.59 12.84 13.08
11.85
11.61
12.41 12.67
13.19 13.44 13.70
12.93
12.16
13.51 13.78 14.05 14.32
12.97 13.24
12.71
14.10 14.38 14.66 14.95
13.26 13.54 13.82
13.81 14.10 14.40 14.69 14.98 15.28 15.57
Te
14.67
14.36
13.75 14.06
12.24 12.54 12.85 13.15 13.45
14.60 14.92 15.24
14.29
13.34 13.66 13.97
12.71 13.03
15.15 15.48 15.81 16.14
12.09 12.40
12.53 12.86 13.18 13.51 13.84 14.16 14.49 14.82
16.72
16.04 16.38
15.70
15.35
15.01
14.00
14.67
13.32 13.66
14.33
12.98
16.95 17.31
16.60
15.89 16.24
15.19 15.54
14.48 14.83
13.43 13.78 14.13
19.00 19.38
18.27 18.63
17.53
16.79 17.16
16.06 16.43
15.33
14.25 14.61 14.97
15.70
18.87 19.25 19.63 20.02
13.89
18.11
17.35
16.59 16.97
15.84 16.21
14.34 14.71 15.09 15.46
18.29 18.69 19.08 19.47 19.87 20.26 20.66
16.34
14.79 15.18 15.57 15.95
17.90
16.73 17.12 17.51
18.86 19.27 19.67 20.08 20.49 20.90 21.31
17.25 17.65 18.05 18.46
16.85
16.44
15.65 16.05
21.53 21.95
20.69 21.11
19.85 20.27
19.43
18.60 19.01
18.18
17.77
17.35
16.53 16.94
16.11
17.90
18.49
17.73
15.25
15.70
MODA ALA
24.69
24.13
23.57
23.01
22.46
21.35 21.90
20.80
25.25
24.68
23.53 24.10
22.97
21.83
21.27
22.40
25,81
25.23
24.06 24.64
23.48
22.90
21.74 22.32
26.38
25.78
25.18
24.58
23.39 23.99
22.21 22.80
26.95
26.33
25.72
25.11
23.89 24.50
22.69 23.29
6.88
7.46
6.62 6.75
7.18 7.32
7.75 7.90 8.05
8.31 8.48 8.64
8.88 9.06 9.23
FRB-103-M
20.43 20.87 21.30 21.73 22.17 22.60
19.14
20.00
19.57
18.71
17.86 18.29
17.43
17.01
16.58
16.16
21.02 21.46 21.91 22.36 22.81 23.25
19.25
20.13
19.69
20.58
18.81
18.37
17.49 17.93
16.62 17.06
23.45 23.91
22.52 22.99
21.61 22.07
20.24 20.69 21.15
19.78
19.33
18.88
18.43
17.98
17.08 17.53
24.56
23.14
24.09
23.61
27.67
22.20
21.73
21.26
20.79
20.32
19.86
19.39
18.46 18.93
17.54 18.00
25.22
24.25 24.73
23.27 23.76
21.82
22.79
22.30
21.34
20.86
20.38
19.90
18.95 19.43
18.00 18.48
22.39
21.89
21.40
20.91
20.42
19.93
19.44
18.95
18.47
22.96
22.45
21.94
21.44
20.93
19.93 20.43
18.93 19.43
23.53
21.97 22.49 23.01
21.45
20.42 20.94
19.91
19.40
24.10
23.03 23.57
22.50
21.44 21.97
19.86 20.39 20.91
24.67
24.12
23.58
23.03
22.49
21.41
20.33 20.87
21.95
25.25 25.81
26.40
25.82
26.40 26.99
26.98 27.59
28.18
27.56
7.01
7.60
8.20
8.81
9.41
25.38 25.88
22.88
23.88 24.38 24.88
23.38
26.55
26.03
25.51
25.00
23.47 23.98 24.49
26.6A 27.21
26.15
25.62
24.57 25.10
24.05
27.33 27.88
26.79
26.25
24.64 25.17 25.71
27.99 28.55
26.88 27.43
25.22 25.77 26.32
26.37 26.94 27.51
26.98 27.56 28.14
27.58 28.18 28 TT
28,80
28.19
29.41
29.42
28.80
30.04
28.78
28.15
29.41
27.52
26.89
26.26
25.64
25.02
24.40
23.16 23.78
28.09 28.73
25.53 26.17 26.81 27.45
30.02
29.38
23.64 24.27 24.90
28.66 29.32
24.11 24.76 25.40 26.05 26.70 27.35 28.00
29.98 30.64
29.23
25.25 25.91 26.57 27.23 27.90 28.56
29.91 30.58 31.25
24.59
30.50
31.87
31-18
29.81
29.13
27.77 28.44
25.74 26.41 27.09
25.07
28.08
28.72
29.37
30.02
30.67
29.65 29.22
29.31 29.89
29.97 30.57
30.63 31.24
31.29 31.92
31.32 31.96 32.60
30.05 30.68
31.98 32.63 33.29
31.32
30.67
31.97 32.63 33.30 33.97
31.30
31.93 32.61 33.29 33.98 34.66
33.95 34.65 35.35
33.26
32.56
33.20 33.91 34.62 35.33 36.04
32.49
25.55 26.23 26.92 27.61 28.30 28.99 29.69 30.39 31.09 31.79
33.83 34.56 35.28 36.01 36.74
26.03 26.73 27.43 28.13 28.84 29.54 30.25 30.97
33.11
31.68 32.39
26.51 27.23 27.94 28.66 29.37 30.10 30.82 31.55 32.27 33.00 33.74 34.47 35.21 35.95 36.69 37.43
27.00 27.72 28.45 29.18 29.91 30.65 31.39 32.13 32.87 33.61 34.36 35.11 35.86 36.62 37.37 38.13
27.48 28.22 28.96 29.71 30.45 31.20 31.96 32.71 33.47 34.23 34.99 35.75 36.52 37.29 38.06 38.83
Expert Solution
Step 1
Loan amortization is the process of paying off a loan based on an equal monthly payment. Each payment comprises interest computed on the opening balance and a part of the principal repaid.
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