CFIN
5th Edition
ISBN: 9781305661639
Author: Scott Besley, Eugene Brigham
Publisher: Cengage Learning
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Question
Chapter 4, Problem 23PROB
Summary Introduction
W has taken loan of $50,000 at 4.2% interest rate and need to make monthly payments for 10 years.
Here,
The present value of an annuity is “
The periodic payments are “PMT”.
The interest rate is “r”.
The maturity period of number of years is “n”.
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Derrick recently graduated. He owes $17,525 in student loans with APR of 4.6% compounded monthly. He is expected to pay off his loan in 15 years. Round answer to two decimal points
a. Under the current terms of his loan what is Derricks minimum payment?
b. What is the total amount Derrick will pay when the loan is complete?
c. How much will Derrick pay in interest?
d. Derrick wants to pay more than the required monthly amount for his loan. Assuming the same conditions of the original student loan what would Derrick new monthly payment would be if he pay off loan in 10 years
e. What is the total amount Derrick will pay if they pay off the loan in 10 years?
f. With the 10 year loan how much will Derrick pay in interest?
Kent owes $38000 with an interest rate of 4% in the student loans. If the loan will be paid after 2 years. How much interest will he pay?
Chapter 4 Solutions
CFIN
Ch. 4 - Prob. 1PROBCh. 4 - Prob. 2PROBCh. 4 - Prob. 3PROBCh. 4 - Prob. 4PROBCh. 4 - Prob. 5PROBCh. 4 - Prob. 6PROBCh. 4 - Prob. 7PROBCh. 4 - Prob. 8PROBCh. 4 - Prob. 9PROBCh. 4 - Prob. 10PROB
Ch. 4 - Prob. 11PROBCh. 4 - Prob. 12PROBCh. 4 - Prob. 13PROBCh. 4 - Prob. 14PROBCh. 4 - Prob. 15PROBCh. 4 - Prob. 16PROBCh. 4 - Prob. 17PROBCh. 4 - Prob. 18PROBCh. 4 - Prob. 19PROBCh. 4 - Prob. 20PROBCh. 4 - Prob. 21PROBCh. 4 - Prob. 22PROBCh. 4 - Prob. 23PROBCh. 4 - Prob. 24PROBCh. 4 - Prob. 25PROB
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