Blue Skies Bank of Florida issues a three-month (90-day) negotiable CD in the amount of $20 million to ABCInsurance Company at a negotiated annual interest rate of 2.75 percent (360 day basis). Calculate the value ofthis CD account on the day it matures and the amount of interest income ABC will earn. What interest returnwill ABC Insurance earn in a 365 day year?write the laws pleas

CD is certificate of deposit that have interest rate specified on that and will receive amount on…

Blue Skies Bank of Florida issues a three-month (90-day) negotiable CD in the amount of $20 million to ABC Insurance Company at a negotiated annual interest rate of 2.75 percent (360 day basis). Calculate the value o this CD account on the day it matures and the amount of interest income ABC will earn. What interest return will ABC Insurance earn in a 365 day year?

Blue Skies Bank of Florida issues a three-month (90-day) negotiable CD in the amount of $20 million to ABC Insurance Company at a negotiated annual interest rate of 2.75 percent (360 day basis). Calculate the value o this CD account on the day it matures and the amount of interest income ABC will earn. What interest return will ABC Insurance earn in a 365 day year?

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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A borrower has secured a 30 year, $131,000 loan at 8% with monthly payments. Fifteen years later, the borrower has the opportunity to refinance with a fifteen year mortgage at 7.5%. However, the new loan requiers the borrower to pay 2 points at closing. What is the return on investment if the borrower expects to remain in the home for the next fifteen years? Please input your answer as an annual interest rate (i.e. 8.32% would be input as 8.32).
LOA Bank Limited quotes a 9 percent interest rate on loans for 1 year. You are seeking a loan of $50,000 and as such you are expected to pay $4,500 in interest for the year. The terms of the loan require you to repay the principal and interest at the end of year one = $54,500. LOA Bank Limited thus requires you to pay $54,500 over a 12 month period, or $4,541.67, per month over the next 12 months.Is this a 9 percent loan? What rate should be legally quoted? What is the effective annual rate?Kindly show all workings in detail.
A floating rate mortgage loan is made for $185,000 for a 30-year period at an initial rate of 12 percent interest. However, the borrower and lender have negotiated a monthly payment of $1,480. Required: a. What will be the loan balance at the end of year 1? b. If the interest rate increases to 13 percent at the end of year 2, how much is the payment plus negative amortization in year 2 and year 5 if the payment remains at $1,480?
A mortgage of $152,000 is to be repaid by making payments of $847 at the end of each month. If interest is 4.19% per annum compounded annually, what is the term of the mortgage? State your answer in years and months (from 0 to 11 months). The term of the mortgage is year(s) and month(s).
A floating rate mortgage loan is made for $170,000 for a 30-year period at an initial rate of 12 percent interest. However, the borrower and lender have negotiated a monthly payment of $1,360. Required: a. What will be the loan balance at the end of year 1? b. If the interest rate increases to 13 percent at the end of year 2, how much is the payment plus negative amortization in year 2 and year 5 if the payment remains at $1,360? Complete this question by entering your answers in the tabs below. Required A Required B What will be the loan balance at the end of year 1? Note: Do not round intermediate calculations. Round your final answer to 2 decimal places. Loan balance
Give typing answer with explanation and conclusion to all parts Your bank has pre-approved a mortgage for the purchase of a home. The bank calculates that you can make monthly payments of up to 40% of your salary, which is $78,000 annually. The bank charges a 1.5% closing fee on the mortgage which must be paid up-front (when the mortgage closes). The interest rate quoted on the mortgage is 6.60% per annum for a 25-year loan. a. Up to what net amount will the bank lend you? b. The APR of this loan is 6.60%, but what is the effective annual rate (EAR)? c. How much will still be due after 3 years?
If you borrow $1000.00 on May 1, 2019, at 10% compounded semi dash annually, and interest on the loan amounts to $134.11, on what date is the loan due?
Go Debt Bank Limited quotes a 9 percent interest rate on loans for 1 year. You are seeking a loan of $50,000 and as such you are expected to pay $4,500 in interest for the year. The terms of the loan requires you to repaythe principal and interest at the end of year one = $54,500. Go Debt Bank Limited thus requires you to pay $54,500 over a 12 month period, or $4,541.67, per month over the next 12 months. I s this a 9 percent loan? What rate should be legally quoted? What is the effective annual rate? Kindly show all workings in details.
A floating rate mortgage loan is made for $120,000 for a 30-year period at an initial rate of 12 percent interest. However, the borrower and lender have negotiated a monthly payment of $960. Required: a. What will be the loan balance at the end of year 1? b. If the interest rate increases to 13 percent at the end of year 2, how much is the payment plus negative amortization in year 2 and year 5 if the payment remains at $960?
TVM Calculate the required monthly payments for: 1) a 30-year mortgage loan at an annual rate of 3.75%; and 2) a 15-year mortgage loan at an annual rate of 3.25%. Assume both mortgage loans are $100,000. 3) Which loan will have the lowest loan balance in exactly 5 years (60 months), and what is the balance?
Assuming a 28% lender's affordability ratio, estimated monthly property taxes and insurance of P250, a 25% down payment (of the purchase price), and an annual gross income of P84,800, calculate the maximum purchase price based on monthly income. The monthly payment will occur at the end of the month and you plan to pay off the mortgage over a 30-year period at a 6.25% annual interest rate. a.P374,343b.P280,757c.P282,219d.P321,360e.None of the above
A floating rate mortgage loan is made for $190,000 for a 30-year period at an initial rate of 12 percent interest. However, the borrower and lender have negotiated a monthly payment of $1,520. Required: a. What will be the loan balance at the end of year 1? b. If the interest rate increases to 13 percent at the end of year 2, how much is the payment plus negative amortization in year 2 and year 5 if the payment remains at $1,520?

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