You want to buy a new car. You can afford payments of $200 per month and can borrow the money at an interest rate of 6.3% compounded monthly for 5 years. a) How much are you able to borrow? b) How much interest do you pay?
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You want to buy a new car. You can afford payments of $200 per month and can borrow the money at an interest rate of 6.3% compounded monthly for 5 years.
a) How much are you able to borrow?
b) How much interest do you pay?
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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?You want to buy a new car. You can afford payments of $200 per month and can borrow the money at an interest rate of 3.1% compounded monthly for 5 years. How much are you able to borrow? How much interest do you pay?You want to buy a new car. You can afford payments of $275 per month and can borrow the money at an interest rate of 3.9% compounded monthly for 3 years.How much are you able to borrow?How much interest do you pay?
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- (Use Formula Approach or Calculator Approach) Suppose you borrow $10,000 from your parents to buy a car. You agree to pay $207.58 per month for 60 months. What is the monthly interest rate?Do you want to buy a new car. You can afford payments of 200 times per month and can borrow the money yet an interest rate of 4.9% compounded monthly for five. How much are you able to borrow? How much interest will you pay?You want to buy a car with a local bank that will lend you $20000. The loan will fully amortized over 5 years and the nominal rate of interest will be 14% with interest paid monthly, then a. What will be your monthly payment? b. Effective Annual Rate? c. Explain why total interest is different?
- A friend asks to borrow $45 from you and in return will pay you $48 in one year. If your bank is offering a 5.7% interest rate on deposits and loans: a. How much would you have in one year if you deposited the $45 instead? b. How much money could you borrow today if you pay the bank $48 in one year? c. Should you loan the money to your friend or deposit it in the bank? a. How much would you have in one year if you deposited the $45 instead? If you deposit the money in the bank today you will have in one year. (Round to the nearest cent.) b. How much money could you borrow today if you pay the bank $48 in one year? You will be able to borrow $ today. (Round to the nearest cent.) c. Should you loan the money to your friend or deposit it in the bank? (Select from the drop-down menu.) From a financial perspective, you should as it will result in more money for you at the end of the year.Suppose that you decide to borrow 16000 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 6.4% What would be the monthly payments for each loan and total interest for them also? How much will the buyer save in interest?You decide that you can spend 600 as a monthly payment for a new car. Your bank offers car loans at 5.5% APR for 3 years. How much can you borrow? Round your answer to the nearest dollar.