enext five years, and the annual interest rate is 6%. ich of the following formulas determines Frank's monthly payment? Loan Amount x (0.06 / [1/ (1 + 0.06)F) O Loan Amount x (0.005 / {1 - [1/ (1 + 0.005)160 }) Loan Amount x (6 / {1 - [1/ (1 + 6)]³}) nk's monthly payment is equal to Frank decides to repay the loan in six years instead of five years, his monthly payment would

enext five years, and the annual interest rate is 6%. ich of the following formulas determines Frank's monthly payment? Loan Amount x (0.06 / [1/ (1 + 0.06)F) O Loan Amount x (0.005 / {1 - [1/ (1 + 0.005)160 }) Loan Amount x (6 / {1 - [1/ (1 + 6)]³}) nk's monthly payment is equal to Frank decides to repay the loan in six years instead of five years, his monthly payment would

Corporate Fin Focused Approach

5th Edition

ISBN:9781285660516

Author:EHRHARDT

Publisher:EHRHARDT

Chapter4: Time Value Of Money

Section4.17: Amortized Loans

Problem 1ST

See similar textbooks

Similar questions

Suppose you purchase a home and obtain a 15-year fixed-rate loan of $195,000 at an annual interest rate of 6.0%. a) What is your monthly payment? N: months I %: P.V: $ PMT: $ F.V: 0 P/Y: 12 C/Y: 12 b) Of the first month's mortgage payment, how much is interest? HINT: I=Prt Interest: I=$ c) Of the first month's mortgage payment, how much is applied to the principal? HINT: PMT - Interest Amount Applied to Principal: $ d) How much is your outstanding balance after the first month’s payment? HINT: Principal - Amount Applied to Principal Outstanding Balance after first payment: $
A man plans to take a vacation in 4 years. He wants to buy a certificate of deposit for $1200 that he will cash in for the trip. What is the minimum annual interest rate he must obtain on the certificate if he needs at least $1700 for the trip? Assume that the interest on the loan is computed using simple interest The rate he must obtain is ___%
A customer of your bank comes for a car loan 10000 OMR. He is charged with an interest rate of 5% per year. The customer expects a monthly repayment schedule from you, to plan his repayment. Provide a loan amortization schedule for a monthly repayment of 1 year. (Amortization factor is 0.952 )
Assume you bought a car using a loan that requires payments of $3,000 to be made at the end of every yearfor the next three years. The loan agreement indicatesthe annual interest rate is 6 percent. Which table in thisappendix would you use to calculate the car’s equivalentcost if you were to pay for it in full today?a. Table C.1 (Future Value of $1)b. Table C.2 (Present Value of $1)c. Table C.3 (Future Value of Annuity of $1)d. Table C.4 (Present Value of Annuity of $1)
Suppose you want to buy a rent to own house worth P450,000. You made a down payment of 15% of the purchase price and take a 25 year mortgage for the balance. a. What is your down payment? b. What is your mortgage amount? c. What is the total interest charged over the life of the loan if your monthly payment is P2,200? Solve manually in a paper.
You have just purchased a car and taken out a $50,000 loan. The loan has a five-year term with monthly payment and an APR of 5.5%. 1. What is the monthly interest rate? А. 2.75% В. 0.46% О С. 0.015% O D. 1.38%
Suppose that you decide to borrow $13,000 for a new car. You can select one of the following loans, each requiring regular monthly payments. Installment Loan A: three-year loan at 6.3% Installment Loan B: five-year loan at 4.8% P. Use PMT = to complete parts (a) through (c) below. - nt 1- a. Find the monthly payments and the total interest for Loan A. The monthly payment for Loan A is $. (Do not round until the final answer. Then round to the nearest cent as needed.) The total interest for Loan A is $. (Round to the nearest cent as needed.) b. Find the monthly payments and the total interest for Loan B. The monthly payment for Loan B is $. (Do not round until the final answer. Then round to the nearest cent as needed.) The total interest for Loan B is $. (Round to the nearest cent as needed.) MacBook Air
Suppose that you decide to borrow $15,000 for a new car. You can select one of the following loans, each requiring regular monthly payments. Installment Loan A: three-year loan at 6.3% Installment Loan B: five-year loan at 4.8% PA [¹-(1+] Use PMT= -nt7 to complete parts (a) through (c) below. a. Find the monthly payments and the total interest for Loan A. The monthly payment for Loan A is $. (Do not round until the final answer. Then round to the nearest cent as needed.)
Suppose an engineer purchases a home and secures a loan of ₱2.5M from a commercial bank for 20 years at an annual interest rate of 9%. Find the monthly amortization of the loan. How much is the total amount paid over the life of the loan in Problem 1? How much is the total amount of interest paid over 20 years in Problem 1? I hope you can help me. Thank youu
Suppose that you decide to borrow $15,000 for a new car. You can select one of the following loans, each requiring regular monthly payments. Installment Loan A: three-year loan at 5.9% Installment Loan B: five-year loan at 4.8% P Use PMT = to complete parts (a) through (c) below. - nt 1- 1+ a. Find the monthly payments and the total interest for Loan A. The monthly payment for Loan A is $. (Do not round until the final answer. Then round to the nearest cent as needed.)
The formula below finds the monthly payment for a loan (car, mortgage, student): P=I (r/1-(1+r)-n ) P = monthly payment I = initial loan amount borrowed r = monthly interest rate n = number of months to pay off the loan 5. Assume you decide to take a 5-year car loan, with a 3.25% APR paid monthly. Insert the numbers you have so far into the formula above and simplify as much as possible. Show any in-between steps you do. (Note: simplify means to calculate the parts of the equation that you can so far.) 6. Use your simplified formula from above to answer: What is the largest amount you can borrow for the car if you can afford a $350/month payment? Show work.
Suppose you purchase a car for a total price of $21,750, including taxes and license fee, and finance that amount for 7 years at an annual interest rate of 6%. (Round your answers to the nearest cent.) (a) Find the monthly payment.$ (b) What is the total amount of interest paid over the term of the loan?$