When Maria Acosta bought a car 2 1/2 years ago, she borrowed $10,000 for 48 months at 7.2% compounded monthly. Her monthly payments are $240.39, but she'd like to pay off the loan early. How much will she owe just after her payment at the 2 1/2-year mark? (Round your answer to the nearest cent.)

When Maria Acosta bought a car 2 1/2 years ago, she borrowed $10,000 for 48 months at 7.2% compounded monthly. Her monthly payments are $240.39, but she'd like to pay off the loan early. How much will she owe just after her payment at the 2 1/2-year mark? (Round your answer to the nearest cent.)

EBK CFIN

6th Edition

ISBN:9781337671743

Author:BESLEY

Publisher:BESLEY

Chapter4: Time Value Of Money

Section: Chapter Questions

Problem 25PROB

See similar textbooks

Related questions

Q: Joan Tanaka borrows $80,000 at 14 percent interest toward the purchase of a vacation home.Her…

A: Given: Loan amount = $80,000 Interest rate = 14% Years = 25

Q: Suzan Long is considering buying a home for$350,000.(a) If she makes a down payment of $50,000…

A: In this problem, a person purchases a home for $350,000 and make down payment of $50,000. The…

Q: How much should Elizabeth have in a savings account that is earning 4.50% compounded quarterly, if…

A: Given: Particulars Amount Amount(PMT) $1,550 Years 10 Interest rate 4.50%

Q: The Fergusons want to purchase their first home and need $14,300 for a down payment. They can save…

A: The present value is the value of the sum received at time 0 or the current period. It is the value…

Q: A man buys a car for $36,000. If the interest rate on the loan is 12% compounded monthly, and he…

A: A theory that helps to compute the present or future value of the cash flows is term as the TVM…

Q: A recent college graduate buys a new car by borrowing $18,000 at 7.2%, compounded monthly, for 4…

A: Amortized loan: The method of loan where the borrower makes the periodic payments which include both…

Q: A woman wants to borrow $10,742 in order to buy a car. She wants to repay the loan by monthly…

A: Formula EMI = PV/[1-(1+R)-N]/R Where EMI - Equal monthly instalment PV - Loan amount i.e. $10,742 R…

Q: Dottie wants to buy a 150,000 house and puts a down payment of 60,000. He makes monthly payments for…

A: Given:

Q: Roberto and Micah plan to purchase a home for $225,000. They will pay 20% down and finance the…

A: Monthly installment = loan / cumulative PV factor Monthly installment = loan / PVAIF (0.308333%,…

Q: Joan borrowed $18,000.00 to buy a car. She repaid $4700.00 three months later and $8300.00 nine…

A: If enough funds are not available with a person for a transaction, then the person can avail credit.…

Q: Bob and Pat want to purchase a vacation home in ten years and need $45,000 for a down payment. How…

A: Time value tells that money received today has more value than that of receiving exact value later…

Q: f Brian wants to buy a house that cost $100000 the bank agreed to give him 80% of cost at 0.07…

A: Installment is the amount of periodic payments a borrower has to make to its lender in order to pay…

Q: 1. Nelson wants to buy a car that costs $42,000. He has arranged to borrow the total purchase price…

A: Using the PMT function in excel

Q: Jane has a $35,000 bank loan that she wishes to pay off in five equal annual payments with 12%…

A: given, bank loan = $35,000 installment = 5 interest = 12%

Q: Natasha is going to take out an unsubsidized student loan of $13,500 at a 4.2% APR, compounded…

A: An unsubsidized student loan is a loan on which interest starts accruing the day money is deposited…

Q: A woman wishes to save $20,000 for a down payment on a home. She can afford to set aside $1100 per…

A: The concept of the time value of money states that the same amount of money is worth more now than…

Q: A recent college graduate buys a new car by borrowing $24,000 at 8.4%, compounded monthly, for 5…

Q: In 20 years, Hannah would like to have $30,000 in an account that earns 4.2% compounded monthly. How…

A: In the given question we need to compute the Deposit today so that Hannah will have $30000 at the…

Q: A woman, with her employer's matching program, contributes $400 at the end of each month to her…

A: The question is based on the concept of Annuity.

Q: Five years ago, Diane secured a bank loan of $400,000 to help finance the purchase of a loft in the…

A: Excel Spreadsheet: Excel Workings:

Q: A recent college graduate buys a new car by borrowing $16,000 at 7.2%, compounded monthly, for 5…

A: Any cashflow of equal instalments can be called as an annuity. A loan with equal repayments at equal…

Q: Mary decided to begin saving towards the purchase of a new car in 5 years. If Mary put $500 at the…

A: The future value is the amount that will be received at the end of a certain period. In simple…

Q: A recent college graduate buys a new car by borrowing $18,000 at 6%, compounded monthly, for 4…

A: The following calculations are done in the records of a recent college graduate who has applied for…

Q: Bryce and David plan to purchase a home for $176,000. They will pay 20% down and finance the…

A: Down payment = 20% Loan (L) = 80% of $176000 = $140800 n = 15 years = 180 months r = 8.2% per annum…

Q: Ken is paying off a loan by making a $50 down payment and then $50 payments at the end of every…

A: Loan is the amount borrowed by the company or individual for the purpose of fulfilling the financial…

Q: When Maria Acosta bought a car 2 years ago, she borrowed $12,000 for 48 months at 7.2% compounded…

A: Outstanding loan balance is calculated by present value of monthly payments left to be paid. r is…

Q: Robert recently borrowed $20,000 to purchase a new car. The car loan is fully amortized over 4…

A: Ordinary annuity are the PMTs which are made at the end of the period.

Q: Kristy Joe deposits $130 each month in an ordinary annuity to save for a new car. If the annuity…

A: The future value of the investment is computed to find total saving can be made for the new car.…

Q: Rose has saved $90 000. If she decides to withdraw $4000 at the beginning of each month and interest…

A: Present value is the value of the amount in current time that is expected to be received in future…

Q: Kristi Perez puts $10,500 into an account to save money to buy a car in 12 years. She expects the…

A: We require to calculate the interest rate from following details given in the question: Current…

Q: A person needs $20,000 immediately as a down payment on a new home. Suppose that she can borrow this…

A: Loan amount (PV) = $ 20,000 Annual interest rate = 10% Number of compounding per year = 6 Effective…

Q: Mary wants to have $14000 for a trip to Mexico in five years. How much does she need to deposit at…

A: The future value of annuity would be considered the value accumulated in future with a view to…

Q: Mary Smith took a car loan of $20,000 to make 60 equal monthly payments. The interest compounds…

A: Annual worth distributes present worth into equivalent uniform value over its useful life.

Q: The Jones want to save $95,000.00 in 5 years for a down payment on a house. If they make monthly…

A: A down payment is often paid in cash in the early stages of a purchase of an expensive service or…

Q: A recent college graduate buys a new car by borrowing $22,000 at 6%, compounded monthly, for 4…

A: since you have posted a question with multiple sub-questions, we will solve the first three…

Q: A recent college graduate buys a new car by borrowing $16,000 at 6%, compounded monthly, for 5…

A: Payment of loan made in fixed installment which includes interest as well as portion of principal,…

Q: A woman, with her employer's matching program, contributes $500 at the end of each month to her…

A: The future value function can be used to derive the future value of a present sum or stream of cash…

Q: A recent college graduate buys a new car by borrowing $18,000 at 7.2%, compounded monthly, for 5…

A: Installment is the amount of periodic payments made by the borrower to the lender in order to pay…

Q: Jennifer Creek is saving up for a new car. She wants to finance no more than $10,000 of the $26,000…

A: The future value function can be used to determine the future value of a present sum of cash flow,…

Q: Emma bought a $360,000.00 house, paying 10% down, and financing the rest at 2% interest for 20…

A: Price of house = $ 360,000 Dow payment =10% Loan amount (PV) = 360,000*(1-0.10)…

Q: A woman, with her employer's matching program, contributes $300 at the end of each month to her…

A: The future value function or concept can be used to determine the future value of a present sum or…

Q: A year after buying her car, Anita has been offered a job in Europe.Her car loan is for $27,000 at a…

A: Since you have asked multiple questions, we will solve the first question for you. If you want any…

Q: A recent college graduate buys a new car by borrowing $18,000 at 8.4%, compounded monthly, for 5…

A: Borrowing = 18,000 Compounding Monthly, hence we will divide interest by 12 and multiply time period…

Q: Carmen Hernandez has saved $8,000 for a deposit on a car. The highest monthly payment she can afford…

A: Deposit amount = $ 8,000 Monthly payment = $ 455 Annual interest rate = 11% Monthly interest rate =…

Q: Edna invests $30,000 and buys an annuity that pays $2000 every 6 months (1st payment 6 months from…

A: Open MS Excel --> Go to formulas --> Use FV function(Future value) Calculate the future value…

Concept explainers

Cost of Credit

The cost of credit is an extra amount that the borrower has to pay besides the loan amount. These credit charges may vary from loan to loan. The cost of credit includes interest charges, maintenance charges, and arrangement charges. Some of the costs are mandatorily collected by the lender based on the loan amount and tenure of the loan. The cost of credit is also called finance charges of the credit.

Question

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Definition

VIEW

Calculation of total amount owed

VIEW

Calculation of total amount paid in 2 1/2 years

VIEW

Calculation of amount to be repaid

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 4 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, finance and related others by exploring similar questions and additional content below.

Similar questions

When Maria Acosta bought a car 2 owe just after her payment at the 2 $ years ago, she borrowed $13,000 for 48 months at 6.6 % compounded monthly. Her monthly payments are $308.89, but she'd like to pay off the loan early. How much will she -year mark? (Round your answer to the nearest cent.)
1 When Maria Acosta bought a car 2 years ago, she borrowed $12,000 for 48 months at 7.2% compounded monthly. Her monthly payments are $288.47, but she'd like to pay off the loan early. How much will she owe just after her payment at the 2 -year mark? (Round your answer to the nearest cent.) 2
Paige refinanced her home loan. The new loan of $85,000.00 has an interest rate of 3.7% compounded monthly. She is planning to pay off the loan in 19 years, what will her monthly payment be? (Round all answers to 2 decimal places.) The monthly payment would be $. Assuming Paige paid all of the payments on time and did not prepay on the loan. What is the total amount Paige paid and the total interest? The total amount Paige paid was $ and the total interest was
Jane took out a loan from the bank today for X. She plans to repay this loan by making payments of $520.00 per month for a certain amount of time. If the interest rate on the loan is 1.12 percent per month, she makes her first $520.00 payment later today, and she makes her final monthly payment of $520.00 in 7 months, then what is X, the amount of the loan? O An amount less than $3,501.00 or an anmount greater than $4,238.00 O An amount equal to or greater than $3,501.00 but less than $3,739.00 O An amount equal to or greater than $3,739.00 but less than $3,980.00 O An amount equal to or greater than $3,980.00 but less than $4,081.00 O An amount equal to or greater than $4,081.00 but less than $4,238.00
Valerie refinanced her home loan. The new loan of $103,000.00 has an interest rate of 5.9% compounded monthly. She is planning to pay off the loan in 21 years, what will her monthly payment be? (Round all answers to 2 decimal places.) The monthly payment would be $. Assuming Valerie paid all of the payments on time and did not prepay on the loan. What is the total amount Valerie paid and the total interest? The total amount Valerie paid was $ and the total interest was
Joan Tanaka borrows $80,000 at 14 percent interest toward the purchase of a vacation home.Her mortgage is for 25 years. a. How much will her annual payments be? (home payments are usually on a monthly basis, but we shall do our analysis on an annual basis for ease of computation.) b. How much interest will she pay over the life of the loan?
Ingrid wants to buy a $20,000 car in 8 years. How much money must she deposit at the end of each quarter in an account paying 5.5% compounded quarterly so that she will have enough to pay for her car? How much money must she deposit at the end of each quarter? $ (Round to the nearest cent as needed.)
A woman wants to borrow $10,742 in order to buy a car. She wants to repay the loan by monthly installments for 6 years. If the interest rate on this loan is 5.5% per year, compounded monthly, what is the amount of each payment? (Round your answer to the nearest cent.) Submit Question
Pat Lavoie bought a home for $180,000 with a down payment of $10,000. Her rate of interest is 6% for 30 years. (Round your answer to the nearest cent.) a. Calculate her monthly payment. b. By how much will her loan principal decrease after she makes her first monthly payment? c. Calculate her balance of mortgage at the end of the month.
The Fergusons want to purchase their first home and need $14,300 for a down payment. They can save $1,025 per quarter. If they deposit this amount in an account paying 3% interest compounded quarterly, how long will it be before they can purchase a home? (Solution should be entered in years accurate to the hundredths decimal place)
1. Mary Smith took a car loan of $20,000 to make 60 equal monthly payments. The interest compounds monthly. (a) Calculate the monthly payment for Mary, if the nominal interest is 9% per year.(b) (How much interest would Mary pay for taking the loan? (c) Immediately after making the 20th payment, if she wants to pay off the car loan, how much does she need to pay?
April borrows $20000 at an interest rate of 7% to purchase a new automobile. At what rate (in dollars per year) must she pay back the loan, if the loan must be paid off in 5 years? (Use decimal notation. Give your answer to two decimal places.) withdrawal rate: $ per year