12 Loan Amount (BO)3 Annual Interest Rate4#times per year interest accrued5Periodic Rate6 Term (years)7 #payments per year8 Number of payments (N)9 Balloon (balance after final payment)10 Points paid at origination to get loan111213141516171819202122232425262728293031323334353637383940414243$1,000,000.007.66%120.64%3012360$0.00 AKA "Fully Amortizing"1.50%t01234567891011121314151617181920212223242526272829Balance in (t): B_(t)$1,000,000.00Interest in (t+1): (i/m)*B_t$6,383.33Payment in (t+1)$7,102.03Balance in (t+1): B_(t+1)$999,281.30Principal paid in (t+1) (=PMT-INT)$718.70

A fully amortizing loan is where the balance keeps reducing after each payment until it becomes zero…

2 Loan Amount (80) 3 Annual Interest Rate 4 # times per year interest accrued 5 Periodic Rate 6 Term (years) 7 # payments per year 8 Number of payments (N) 9 Balloon (balance after final payment) 10 Points paid at origination to get loan 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 $1,000,000.00 7.66% 12 0.64% 30 12 360 $0.00 AKA "Fully Amortizing" 1.50% t 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Balance in (t): B (t) $1,000,000.00 Interest in (t+1): (i/m)*B_t $6,383.33 Payment in (t+1) $7,102.03 Balance in (t+1): B_(t+1) $999,281.30 Principal paid in (t+1) (=PMT-INT) $718.70

2 Loan Amount (80) 3 Annual Interest Rate 4 # times per year interest accrued 5 Periodic Rate 6 Term (years) 7 # payments per year 8 Number of payments (N) 9 Balloon (balance after final payment) 10 Points paid at origination to get loan 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 $1,000,000.00 7.66% 12 0.64% 30 12 360 $0.00 AKA "Fully Amortizing" 1.50% t 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Balance in (t): B (t) $1,000,000.00 Interest in (t+1): (i/m)*B_t $6,383.33 Payment in (t+1) $7,102.03 Balance in (t+1): B_(t+1) $999,281.30 Principal paid in (t+1) (=PMT-INT) $718.70

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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39 Identify the correct formula to calculate the payment for a loan, where the rate is 6%, the loan amount is $2,000, and payments will be made monthly for six years. =PMT(6,6*12,2000) =PMT(.06/12,6*12,-2000) once=1/1b1435-b60f-40fb-ad57-d89084c2075a&launchCode=qe8mtdEeV5pWjPP2nq... =PMT(.06,6*12,-2000) =PMT(.06,6*12,2000)
Franklin's new snowmobile cost $9,500. After his down payment of $1,500, he financed the remainder at 10% for 3 years. Use the table to find the monthly payment for the amortized loan. Find the total interest paid on the loan. Click the icon to view a table of monthly payments on a $1,000 loan. The monthly payments for this loan are $. (Round to the nearest cent as needed.) Enter your answer in the answer box and then click Check Answer. ? 1 part remaining Clear All Greck Answer javascript:doExercise(5); Copyright © 2020 Pearson Education Inc. All rights reserved. | 99 a 近

Increasing the down payment on a mortgage reduces both the size of the monthly payments and the total interest paid. Calculate (a) the reduction in the monthly payment by increasing the down payment by the amount specified, and (b) the amount saved on interest over the life of the loan. Assume the mortgage is for 10 years and use the amortization table to find the monthly payments. Increase in Amount of Loan Interest Rate Down Payment Down payment $191,000 12% $32,000 $15,000 Click the icon to view a table of monthly payments on a $1,000 loan. a. The monthly payment will be reduced by $ when the down payment is increased by $15,000. (Round to the nearest cent as needed.) Enter your answer in the answer box and then click Check Answer. 1 part Check Answer SO Clear All remaining javascript:doExercise(5); Copyright © 2020 Pearson Education Inc. All rights reserved. Ter 99+ a 近
10) Compute the simple interest and final amount of each loan Principal Rate Time P 400 7% 1 year P 640 9% 3 months P 985 10% 180 days (ordinary time period) 60 days (exact time period) P 850 6% ABCD Interest ? ? ? ? Final amount ? ? ? ?
In order to buy a vacation home, Neal and Lilly took out a 20-year mortgage for $220,000 at an annual interest rate of 6%. After 10 years, they refinanced the unpaid balance of $142,125 at an annual rate of 4%. Use the table to find the monthly payments on the original loan; the monthly payments on the new loan; and the total amount saved on interest by refinancing. Click the icon to view a table of monthly payments on a $1,000 loan. The monthly payments on the original loan are $ (Type an integer or a decimal.) Enter your answer in the answer box and then click Check Answer. 2 parts remaining Clear All Check Answrer javascript:doExercise(6); 10:45 PM 10/26/2020 120
Amortization schedule Loan amount to be repaid (PV) $25,000.00 Interest rate (r) 11.00% Length of loan (in years) 3 a. Setting up amortization table Formula Calculation of loan payment #N/A Year Beginning Balance Payment Interest Repayment of Principal Remaining Balance 1 2 3 b. Calculating % of Payment Representing Interest and Principal for Each Year Year Payment % Representing Interest Payment % Representing Principal Check: Total = 100% 1 2 3 Formulas Year Beginning Balance Payment Interest Repayment of Principal Remaining Balance 1 #N/A #N/A #N/A #N/A #N/A 2 #N/A #N/A #N/A #N/A #N/A 3 #N/A #N/A #N/A #N/A #N/A b. Calculating % of Payment Representing Interest and Principal for Each Year Year Payment %…
QUESTION 14 You have taken a loan of $300,000 over 12 years at a 6% interest rate compounded monthly, which is reimbursed with monthly payments. What is the principal portion of the 61st payment? O1,925.55 1,933.14 O654.56 449.86
FRM. (Term=30 years, Note Rate = 5.25, Loan Amount = 800,000, Points=2) What is the FTL annual percentage rate (FTLAPR) that the lender must disclose to the borrower? O 5.375% ○ 4.750% O 4.875% O 7.000% O 6.905% O 7.011%
What will be the compounded amount on a loan of P1.500 at 12% interest compounded quarterly for 1 year? of O P16.822.63 O P1.690 O Pl,688.26 O P16.860
18 .Use the following amortization chart: Selling price of home Down payment Principal (loan) Rate of interest Years Payment per $1,000 Monthly mortgage payment $ 90,000 $ 5,000 $ 85,000 5 1/2% 30 $ 5.67789 $ 482.62 What is the total cost of interest? Note: Do not round intermediate calculations. Round your answer to the nearest cent. Total cost of interest:???
Determine the monthly payment for the installment loan. Use the installment payment formula m = 1- Amount Financed (P) $1,440 O A. $179.15 B. $35.15 O C. $125.26 O D. $366.02 P n 1+) - not Annual Percentage Rate (r) 8% Number of Payments per Year (n) 12 Time in Years (t) 4
Finding the Interest Rate: Concept Connection Example 6-3 (page 237) 18. What interest rates are implied by the following lending arrangements? a. You borrow $500 and repay $555 in one year. b. You lend $1,850 and are repaid $2,078.66 in two years. c. You lend $750 and are repaid $1,114.46 in five years with quarterly compounding. d. You borrow $12,500 and repay $21,364.24 in three years under monthly compounding. (Note. In parts c and d, be sure to give your answer as the annual nominal rate.) Lasher, William R.. Practical Financial Management (Page 276). South-Western College Pub. Kindle Edition.

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