Suppose you are in business and you buy a new machine for $40,000. After paying all other expenses, $7,000 is left that can be attributed to the pro. ductivity of the machine, which only has a one-year useful life. What is the rate of interest earned by this machine? If you had to pay 20 percent to borrow the money to buy such a machine, would you do so? Would you borrow the money at 10 percent?
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- You want to save money from your businessoperation to replace a truck that has been used indelivery. The truck will be replaced after 12 yearsfrom now and the replacement cost would be about$60,000. If you earn 5% interest on your savings,how much must you deposit at the end of each yearto meet the needs?Leasing a machine requires making monthly payments of $6,000 for the next 5 years (i.e., at t = 1, 2, …, 60). Buying the machine today (t = 0) will cost you $320,000. Assume the machine is worthless after 5 years. You can borrow and lend at a semi-annually compounded interest rate of 6% (APR). Would you be better off by buying or leasing? Explain.You want to by a boat and can afford payments of $350 per month for six years. The monthly interest rate is 0.5%. (a) What is the maximum you can spend on the boat if there is no down payment? (b) What is the maximum you can spend on the boat if you make a down payment of $6000 at the time of purchase? 4. A company needs to buy a building in 4 years, and must fund the down payment from its profits. The purchase will cost $280,000, of which the company can finance (borrow from the bank) $200,000 at 7%. If the company must make the purchase in 4 years and can receive 7% APR on its savings compounded annually, how much must the company save each year to have the required down payment in 4 years?
- Suppose you want to buy a car. You have surveyed the dealers' newspaper advertisements, and the one shown has caught your attention. You can afford to make a down payment of $2,678.95, so the net amount to be financed is $20,000.(a) What would the monthly payment be?(b) After the 25th payment, you want to pay off the remaining loan in a lumpsum amount. What is this lump sum?You were able to sell a car worth 2,100,000, which would be financed by a bank. You told your buyer that the required down payment was 20% of the net price. Your buyer also need to pay the monthly amortization of 34,950 for 5 years.How much was the down payment paid by the buyer?Suppose you decide to wait 5 years to save up before buying the house. You are able to put a down payment of $30,000 on the house, so that you only need to borrow $170,000 from the bank. Assume the interest rate is still the same, but you are now in a better financial position, and you can pay off the loan in 240 equal monthly payments. Answer the following questions about this loan. After making 240 monthly payments, how much of what you paid the bank was interest? $ . ROUND TO THE NEAREST CENT. THANKS APPRECIATE THE HELP!!!
- You are interested in buying a house worth P1,200,000. You paid P250,000 as down payment. In order to pay for the remaining amount, you take out a loan from the bank at a 9% interest rate to be paid for 25 years. a.) How much of the principal has been paid after 10 years? b.) After 15 years, you decide to sell the house. How much should. The selling price be to cover the remaining balance of payments? c.) What is the total interest paid for the loaned amount?You can buy property today for $3.9 million and sell it in 5 years for $4.9 million. (you have no rental income on the property). 1. If the interest rate is 8% what is the present value of the sales price? 2. Is the property investment attractive to you? 3. What is the present value of the future cash flows if you are could earn $290000 per year rent on the property? The rent is paid at the end of each year. 4. Is the property investment attractive to you now?A man bought a refrigerator for P500 down and P300 per month for 24 months. The same brand of refrigerator could have been purchased for P6,750 cash. What nominal annual interest rate is the man paying?
- You were able to sell a car worth 2,100,000, which would be financed by a bank. You told your buyer that the required down payment was 20% of the net price. Your buyer also need to pay the monthly amortization of 34,950 for 5 years.How much was the down payment paid by the buyer?How much was the gross balance or the amount to be financed by the bank?How much was your total commission if you received a commision of 5.25% based on the suggested retail price of the car from the car dealer and 1.25% incentive from the bank.How much was the interest rate charged by the bank for requiring the buyer to pay the monthly amortization of 34,950 for 5 years?Please use formula in solving. You are interested in buying a house worth P1,200,000. You paid P250,000 as down payment. In order to pay for the remaining amount, you take out a loan from the bank at a 9% interest rate to be paid for 25 years. a) What is your monthly payment?b) What is the total interest paid for the loaned amount?c) How much of the principal has been paid after 10 years? d) After 15 years, you decide to sell the house. How much should the selling price be to cover the remaining balance of the payments?suppose that 10 years ago you bought a home for $150,000, paying 10% as a down payment, and financing the rest at 8% interest for 30 years. your existing mortage (the one you got 10 years ago) how mych money did you pay as your down payment