A declining balance loan for $3000 entails paying about $275 for each of 12 months, for a total of about $3300 in payments. The loans interest rate in 18% per year. How much of the loans second payment goes to paying interest? $41.55 $36.75 $42.58 $45 $40.88
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- Cost of Bank Loan Mary Jones recently obtained an equipment loan from a local bank. The loan is for 15,000 with a nominal interest rate of 11%. However, this is an installment loan, so the bank also charges add-on interest. Mary must make monthly payments on the loan, and the loan is to be repaid in 1 year. What is the effective annual rate on the loan (assuming a 365-day year)?Calculating interest and APR of installment loan. Assuming that interest is the only finance charge, how much interest would be paid on a 5,000 installment loan to be repaid in 36 monthly installments of 166.10? What is the APR on this loan?Calculating and comparing add-on and simple interest loans. Eli Nelson is borrowing 10,000 for five years at 7 percent. Payments, which are made on a monthly basis, are determined using the add-on method. a. How much total interest will Eli pay on the loan if it is held for the full five-year term? b. What are Elis monthly payments? c. How much higher are the monthly payments under the add-on method than under the simple interest method?
- Suppose a bank offers to lend you $10,000 for 1 year on a loan contract that calls for you to make interest payments of $350.00 at the end of each quarter and then pay off the principal amount at the end of the year. What is the effective annual rate on the loan? 14.75% 13.28% 12.39% 11.21% 15.34%A loan is taken out at /12 = 18% and is paid back with monthly payments of $279.00, plus a smaller concluding payment. With one month left on the loan, the outstanding balance is $268.66. What is the size of the final loan payment? $279.00 $264.63 $270.69 $268.66 $272.69A bank makes a loan with the following characteristics: monthly payments for 10 years, with an APR of 6%. The amount loaned is $200,000. What is the duration of the loan? What is the expected change in loan value if the interest rate decreases by 1 percentage point immediately after approving the loan. Choose the closest answer below. 5.32 years; -$10,037 3.21 years; $6,056 4.55 years; -$8,577 6.74 years; $12,716
- Ezze Mattress needs to raise $200,000 for 6 months. The bank quotes a discount interest rate of 7.5% but does not require compensating balances. What is the effective annual interest rate on this loan? Multiple choice question. 7.50% 8.11% 7.84% 7.81%A business loan is amortized constantly through 35 monthly rents, if the first rent is L 8,850 and the rate is 18% compounded by months. What is the value of the credit if before starting the 35 constant amortization rents you make 10 payments of L 5,000.00. Make the amortization table in its first 10 lines and the last 5. How much is the total interest generated?. do the exercise in excelA demand loan for $8955.33 with interest at 9.3% compounded semi-annually is repaid after 8 years, 8 months. What is the amount of interest paid? The amount of interest is $
- A car loan is taken for $20,000 to be paid back in 6 years, with monthly payments of $304. What nominal annual interest rate is being charged in this loan? 13.13% 3.07% 3.00% 1.09%How much is the interest if you need to borrow 400,000 for one year with 475,000 line credit, where any borrowing have a single payment interest of 20% and there is a 1.5% fee for any unused credit? a) 32,000 b) 1,125 c) 60,000 d) 1,265 e) 80,000A lender makes a loan of $100,000 at a 6% interest rate for 25 years with monthly payments. The lender will require an origination fee of $1,000 and will also discount the loan by some amount. Suppose the lender discounts the loan by the amount calculated in the last question. What is the annual percentage rate (APR) on this loan? a. 5.45% b. 6.00% c. 6.11% d.6.20% e. 6.65% Assume the borrower repays the loan after 8 years. What is the effective borrowing cost (EBC) on this loan? a. 6.10 b. 6.17 c. 6.33 d. 6.50 e. 6.84
