Zebulon wants to borrow money. He writes a note that guarantees that 360 days from now he will give an amount of $1818.00 to whoever brings back the note to him. Yolanda wants to invest. She ourchases the note from Zebulon. She pays $1800. After 30 days, Yolanda sells the notes to Walter for $1679.45. Walter keeps the note until maturity. (a) What is the simple interest rate earned by Yolanda? Note that negative rates may occur. When this happens it means that Yolanda lost money :( (b) What is the simple interest rate earned by Walter? (c) What is the simple interest rate at which Zebulon borrowed?

Zebulon wants to borrow money. He writes a note that guarantees that 360 days from now he will give an amount of $1818.00 to whoever brings back the note to him. Yolanda wants to invest. She ourchases the note from Zebulon. She pays $1800. After 30 days, Yolanda sells the notes to Walter for $1679.45. Walter keeps the note until maturity. (a) What is the simple interest rate earned by Yolanda? Note that negative rates may occur. When this happens it means that Yolanda lost money :( (b) What is the simple interest rate earned by Walter? (c) What is the simple interest rate at which Zebulon borrowed?

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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Similar questions

Maria takes out a 30-year fixed rate mortgage at 5% to buy a house that costs $450,000. To avoid paying mortgage insurance, she needs to put 20% of the purchase price as a down payment. (a) How much does she need for the down payment? How much money does Maria need to borrow?
20. PUTTING UP COLLATERAL Joni Perez needs to borrow $20,000 to open a welding shop, but the bank will not lend her the money. Joni's uncle agrees to put up collateral for the loan with a $20,000, 4-year certificate of deposit paying 4% compounded daily. This means that the bank will take all or part of his deposit if Perez should fail to repay the loan. Find (a) the compound amount earned by her uncle and (b) the interest earned by her uncle.
Alex has just obtained a 7-year fixed-rate mortgage to buy her first condo. The mortgage is amortized over 25 years. Which of the following statement is most correct? a. Alex's payrments will not change for the next 25 years. O b. Alex's payments will not change for the next 7 years. Oc. Alex's payments will increase as the term of the mortgage increases. O d. Alex's payments will increase as the amortization period of the mortgage increases. e. Alex's payments will decrease as the term of the mortgage increases.
( Explain well with proper answer) .
8. Joseph borrowed a single-payment loan of $12,000 at an interest rate of 15%. The term of the loan is 90 days. What is the maturity value of his loan under exact interest? 9. Jennifer is planning to borrow $1,250 from her bank. She is willing to pay back in 120 days at an interest rate of 12.75% ordinary interest. What is the maturity value of his loan? 10. Rachel Reeve borrowed $2,000 for some merchandise for her store. The bank offered her a loan for 90 days at an interest rate of 12% exact interest. Calculate the maturity value for the loan. 11. Jeremy received a bank loan of $115,000 be paid back after 45 days at 11% ordinary interest. What is the maturity value?
Your brother-in-law says you will pay him only 13 cents per day for each $200 borrowed. Assuming a 360-day year, what annual interest rate is he actually charging you?
Financial contracts involving investments, mortgages, loans, and so on are based on either a fixed or a variable interest rate. Assume fixed interest rates are used through out this question. Sophie plans to loan $700 to her friend who will pay a simple interest rate of 98% every year for tle loan. If no payment are made and no futher borrowing occurs between them for 11 years, then how much money will sophie's friend owe her? a. 168.60 b. 775.32 c. 1454.60 d. 1957.60 Now assume that sophia's friend volunteers to pay the compound intereST INSTEAD OF SIMPLE INTEREST FOR HER LOAN. if interest is accured at 9.8% compounded annually, all other things being equal, how much money will sophia's friend owe her in 11 years? a. 1454.60 b. 768.60 c. 191.84 d. 1957.60 Sophia has another investment option in the market taht pays 9.8% nominal interesrt, but its compounded quarterly. keeping everything else constant, how much money will sophia have in 11 years if she invests $700 in this fund. a.…
Engr. Tongol borrowed money from a loan shark. He receives from the loan shark an amount of P 134,200 and promise to repay P 150,000 at the end of 1 year and 9 months. What is the simple interest rate?
Please solve this problem as soon as possible
Kwaku Addo earns $4200 per month take-home pay and has the funds directly deposited in his checking account. He spends only about $3500 per month, and the excess funds have been building up in his account for about one year. (a) What other types of accounts are available to Kwaku? (b) How might he manage his accounts to earn as much interest as possible and keep his money safe? (c) How might he use electronic money management to accomplish these tasks?
Abigail's calculations show that the total interest owed to Sanjeev on her 3, 700 loan is 177.60. If she paid simple interest at the rate of 0.4% per month, for how long did Abigail borrow the money? Note: Please make sure your final answer(s) are rounded up to the next whole month.
Phoebe realizes that she has charged too much on her credit card and has racked up $5,400 in debt. If she can pay $200 each month and the card charges 18 percent APR (compounded monthly), how long will it take her to pay off the debt?

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