Pfin (with Mindtap, 1 Term Printed Access Card) (mindtap Course List)
7th Edition
ISBN: 9780357033609
Author: Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk
Publisher: Cengage Learning
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Question
Chapter 7, Problem 10FPE
a)
Summary Introduction
To calculate: Monthly payment of both of loan offers.
b)
Summary Introduction
To calculate: APR for both offers.
c)
Summary Introduction
To calculate: The best offer lower APR or low payment.
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Comparing payments and APRs of financing alternatives. Because of a job change, Finn McBryde has just relocated to the southeastern United States. He sold his furniture before he moved, so he’s now shopping for new furnishings. At a local furniture store, he’s found an assortment of couches, chairs, tables, and beds that he thinks would look great in his new two-bedroom apartment; the total cost for everything is $6,400.
Because of moving costs, Ben is a bit short of cash right now, so he’s decided to take out an installment loan for $6,400 to pay for the furniture. The furniture store offers to lend him the money for 48 months at an add-on interest rate of 6.5 percent. The credit union at Finn’s firm also offers to lend him the money—they’ll give him the loan at an interest rate of 6 percent simple, but only for a term of 24 months.
Compute the monthly payments for both of the loan offers. Show your work.
Determine the APR for both loans.
Which is more important: low…
Comparing payments and APRs of financing alternatives
Because of a job change, Finn McBryde has just relocated to the southeastern United States. He sold his furniture before he moved, so he's now shopping for new furnishings. At a local furniture store, he's found an assortment of couches, chairs, tables, and beds that he thinks would look great in his new, two-bedroom apartment; the total cost for everything is $6,400. Because of moving costs, Finn is a bit short of cash right now, so he's decided to take out an installment loan for $6,400 to pay for the furniture. The furniture store offers to lend him the money for 48 months at an add-on interest rate of 8.5 percent. The credit union at Finn's firm offers to lend him the money - they'll give him the loan at a simple interest rate of 13 percent, but only for a term of 24 months.
Compute the monthly payments for the loan from the furniture store. Round the answer to the nearest cent.________$ per month
Compute the monthly…
Because of a job change, Seth Armstrong has just relocated to the southeastern United States. He sold his furniture before he moved, so he's now shopping for new furnishings. At a local furniture store, he's found an assortment of couches, chairs, tables, and beds that he thinks would look great in his new two-bedroom apartment; the total cost for everything is $6,400. Because of moving costs, Seth is a bit short of cash right now, so he's decided to take out an installment loan for $6,400 to pay for the furniture. The furniture store offers to lend him the money for 48 months at an add-on interest rate of 6.5 percent. The credit union at Seth's firm also offers to lend him the money - they'll give him the loan at an interest rate of 10 percent simple, but only for a term of 24 months.
Compute the monthly payments for the loan from the furniture store. Round the answer to the nearest cent.
$ per month
Compute the monthly payments for the loan from the credit union. Round the…
Chapter 7 Solutions
Pfin (with Mindtap, 1 Term Printed Access Card) (mindtap Course List)
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