Paying rent and insurance premiums are examples of an annuity due. Suppose you have to pay a monthly rents of $1,800 for an apartment studio in LA at the beginning of every month. The annual interest rate is 4%. What comes closest to the present value of the monthly rents if you intend to live there for 24 months and the rent is not expected to change? 28540 O45050 43000 41600

Paying rent and insurance premiums are examples of an annuity due. Suppose you have to pay a monthly rents of $1,800 for an apartment studio in LA at the beginning of every month. The annual interest rate is 4%. What comes closest to the present value of the monthly rents if you intend to live there for 24 months and the rent is not expected to change? 28540 O45050 43000 41600

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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Suppose that you’d like to retire in 40 years and you want to have a future value of $ 1000000 in a savings account. Also suppose that your employer makes regular monthly payments into your retirement account. If you can expect an APR of 6.5% for your account, how much do you need your employer to deposit each month? Employer Contribution = The formulas we have been using assume that the interest rate is constant over the period in question. Over a period of 40 years, though, interest rates can vary widely. To see what difference the interest rate can make, let’s assume a constant APR of 5% for your retirement account. How much do you need your employer to deposit each month under this assumption? Employer Contribution =
Suppose you take out a 30 year mortgage for $ 250000 at 9% interest. The monthly payments on this loan are $ 2011.56. If you pay an extra 50% per month on your mortgage, how soon will you pay off the loan?New length in years
You can afford to pay $15,000 at the end of each of the next 30 years to repay a home loan. If the interest rate is 7.50%, what is the most you can borrow?
1. You have just purchased a home by borrowing $400, 000 for 30-years at a fixed APR of 3.87%. The loan payments are monthly and interest is compounded monthly. What is the periodic interest rate? (l.e., what is the monthly interest rate?) O 0.0129 0.0032 0.0394 0.0013 4
(Annuity number of periods) You've just bought a new flat-screen TV for $4,000 and the store you bought it from offers to let you finance the entire purchase at an annual rate of 13 cescent compounded monthly If you take the financing and make monthly payments of $110, how long will it take to pay off the loan? How much will you pay in interest over the Me of the loan? a. The number of years it will take to pay off the loan as years (Round to one decimal place
You would like to save $250,000 for retirement. If you are planning to retire 30 years from now, how much should you deposit each month into an account that pays 7.2% interest compounded monthly? What is the total interest earned? m
Suppose you take out a 30 year mortgage for $ 200000 at 7.75% interest. The monthly payments on this loan are $ 1432.82. If you pay an extra 60% per month on your mortgage, how soon will you pay off the loan?New length in years = How much will you save in interest by making the extra payments?Saving =
19) Special Loan You take out a $100,000 loan to buy a new yacht. The annual loan rate is ? = 0.04 and the loan period is ? = 10. a. How much is the monthly loan repayment amount? b. If you double your loan repayment each month for the first year, how long will it take to repay the loan? E.g., you double your loan payment amount from part (a) for the first twelve months only, t=1, t=2, ..., t=12. 17)
answer quickly
(Annuity payments) To buy a new house, you must borrow $150,000. To do this, you take out a $150,000, 35-year, 11 percent mortgage. Your mortgage payments, which are made at the end of each year (one payment each year), include both principal and 11 percent interest on the declining balance. How large will your annual payments be? The amount of your annual payment will be $ **** (Round to the nearest cent.)
You need a 25-year, fixed-rate mortgage to buy a new home for $240,000. Your mortgage bank will lend you the money at an APR of 5.35 percent for this 300-month loan. However, you can afford monthly payments of only $800, so you offer to pay off any remaining loan balance at the end of the loan in the form of a single balloon payment. How large will this balloon payment have to be for you to keep your monthly payments at $800? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) Balloon payment

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