You want to buy a car and therefore you borrowed $10,000 from a bank today for 6 years. The nominal interest rate that the bank charges is 7.2%. If you start making equal end-of-month payments then what will be your approximate monthly installment? Group of answer choices $160.31 $154.31 $171.45 $170.43

You want to buy a car and therefore you borrowed $10,000 from a bank today for 6 years. The nominal interest rate that the bank charges is 7.2%. If you start making equal end-of-month payments then what will be your approximate monthly installment? Group of answer choices $160.31 $154.31 $171.45 $170.43

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter22: Providing And Obtaining Credit

Section: Chapter Questions

Problem 2P: Cost of Bank Loan Mary Jones recently obtained an equipment loan from a local bank. The loan is for...

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Use the tables in Appendix B to answer the following questions. A. If you would like to accumulate $2,500 over the next 4 years when the interest rate is 15%, how much do you need to deposit in the account? B. If you place $6,200 in a savings account, how much will you have at the end of 7 years with a 12% interest rate? C. You invest $8,000 per year for 10 years at 12% interest, how much will you have at the end of 10 years? D. You win the lottery and can either receive $750,000 as a lump sum or $50,000 per year for 20 years. Assuming you can earn 8% interest, which do you recommend and why?
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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)?
You put $600 in the bank for 3 years at 15%. A. If Interest Is added at the end of the year, how much will you have in the bank after one year? Calculate the amount you will have in the bank at the end of year two and continue to calculate all the way to the end of the third year. B. Use the future value of $1 table In Appendix B and verify that your answer is correct.
You want to buy a car and therefore you borrowed $10,000 from a bank today for 6 years. The nominal interest rate that the bank charges is 7.2%. If you start making equal monthly payments beginning today then what will be your approximate monthly installment? Group of answer choices $170.43 $154.31 $160.31 $171.45
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Imagine you have a credit card balance of $1,000 that you would like to pay off within one year. The annual interest rate on that credit card is 16%, but interest compounds monthly, and you are required to make a payment each month. What amount would you have to pay monthly to pay off this balance within one year? Question options: a $90.71 b $80.66 c $83.33 d $99.12
Today, you borrowed $6,200 on your credit card to purchase some furniture. The interest rate is 14.9 percent. How long will it take you to pay off this debt assuming that you do not charge anything else and make regular monthly payments of $120? Group of answer choices 6.93 years 7.23 years 6.40 years 7.31 years 5.87 years
Use Excel to answer this question: You want to borrow money from your bank to purchase a car. The maximum amount you are willing to pay is $450 per month. How much can you borrow if the loan lasts for 7 years, your first payment starts today, and the interest rate is 4.5% APR under monthly compounding? $32,495.13 O$29,489.45 O $31,576.98 O $27,456.87
You want to buy a car and therefore you need $10,000. You can borrow from a bank today for 6 years. However, the bank requires you to make down payment of 10% of the amount you want to borrow and will lend you the rest. The nominal interest rate that the bank charges is 7.2%. If you intend to make equal end-of-month payments then what will be your approximate monthly installment on the amount that you borrow? Group of answer choices $170.43 $154.31 $171.45 $160.31
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