Question

Consider an amortizing loan. The amount borrowed initially is $21618, the interest rate is 5% APR, and the loan is to be repaid in equal monthly payments over 17 years. As we know, while each monthly payment will be the same, the amounts of interest and principle paid will change from payment to payment. How much of the very first payment is interest?

Answer #1

**$ 90.08**

**Working:**

Step-1:Monthly Payment Calculation | ||||||||||||

Monhly Payment | = | Loan Amount/Cumulative discount factor | ||||||||||

= | $ 21,618 | / | 137.199 | |||||||||

= | $ 157.57 | |||||||||||

Working: | ||||||||||||

Cumulative discount factor | = | (1-(1+i)^-n)/i | Where, | |||||||||

= | (1-(1+0.00417)^-204)/0.00417 | i | = | 5%/12 | = | 0.00417 | ||||||

= | 137.199 | n | = | 17*12 | = | 204 | ||||||

Step-2:Repayment schedule of first month | ||||||||||||

Month | Beginning Loan balance | Interest for
the month |
Monthly Payment | Principal Repayment | Ending Loan Balance | |||||||

a | b=a*5%*1/12 | c | d=c-b | a-d | ||||||||

1 |
$ 21,618.00 | $ 90.08 |
$ 157.57 | $ 67.49 | $ 21,550.51 | |||||||

1.You are contemplating investing in a portfolio made up of two
stocks, A and B. The beta of Stock A is 1.4, and the beta of Stock
B is -1.3. Assume you plan to invest X% in Stock A, and the rest of
your capital (that is, 1-X) in Stock B. What should X be so that
the beta of the resulting portfolio is zero?
2. Consider an amortizing loan. The amount borrowed initially is
$89202, the interest rate is...

Consider the following loan. Complete parts (a)-(c) below.
An individual borrowed 71,000 at an APR of 77%, which will be
paid off with monthly payments of
$528f or 22 years.
Identify the amount borrowed, the annual interest rate, the
number of payments per year, the loan term, and the payment
amount. The amount borrowed is $the annual interest rate
is %, the number of payments per year is the loan
term is years, and the payment amount is $.
How many...

you borrowed $500,000 to buy a house. The mortgage rate s 24%
(APR, monthly). The loan is to be repaid in equal monthly payments
over 30 years. 29 years has passed. How much you owe to the bank on
your home (loan principal) since you have 1 year left from your
mortgage? Assume that each month is equal to 1/12 of a year.

The following loan is fully amortizing. The loan is for $13,000
at 10% interest to be repaid over three (3) years. Amortize this
loan on a monthly basis. Calculate the interest portion of the
fourth (4th) payment considering that an additional payment of
$2,000 was made with the second payment.
no excel

Two loans, both of an amount of 720,000 are repaid at a nominal
interest
rate of 19.2% convertible monthly. Loan 1 is to be repaid with 360
level monthly
payments. Loan 2 is to be repaid by 360 monthly payments, each
containing
equal principal amounts and an interest amount based on the unpaid
balance.
Payments are made at the end of each month for both loans. The
monthly
payment for Loan 1 first exceeds the monthly payment for Loan 2...

1) i. What is an amortizing loan?
A) A loan in which the borrower only pays principal.
B) A loan in which portions of both principal and interest are
paid in every period.
C) A loan in which the interest portion of payments increase
over time while the principal decreases.
D) A loan in which the borrower pays interest once the principal
balance is depleted.
ii) What is the payment on a 60-month, $10000 car loan with APR
of 9.13%?...

You borrowed $20,000 from a bank at an
interest rate of 12%, compounded monthly.
This loan will be repaid in 60 equal monthly
installments over 5 years. Immediately after
your 30th payment if you want to pay the
remainder of the loan in a single payment, the
amount is close to:

Consider a student loan of $17, 500 at a fixed APR of 12 % for
15 years.
a. Calculate the monthly payment.
b. Determine the total amount paid over the term of the
loan.
c. Of the total amount paid, what percentage is paid toward the
principal and what percentage is paid for interest.

Ellen borrowed $25,000 from a loan shark at the APR of 35%,
compounded monthly. The entire amount, principal plus interest, is
to be repaid at the end of five years. This loan shark is not a
nice person and Ellen is a little nervous, so she starts a savings
account in her local bank. The bank pays interest at the APR of 8%,
compounded quarterly. Ellen will make 20 equal quarterly deposits
into her account, then, right after the last...

?Joan Messineo borrowed $16,000at a15%annual
rate of interest to be repaid over 3 years. The loan is amortized
into three? equal, annual,? end-of-year paymen
a.??Calculate the? annual, end-of-year loan
payment.
b.??Prepare a loan amortization schedule
showing the interest and principal breadown of each of the three
loan payments.
c. Explain why the interest portion of each
payment declines with the passage of time.
?Show calculations

ADVERTISEMENT

Get Answers For Free

Most questions answered within 1 hours.

ADVERTISEMENT

asked 3 minutes ago

asked 8 minutes ago

asked 28 minutes ago

asked 36 minutes ago

asked 56 minutes ago

asked 1 hour ago

asked 1 hour ago

asked 1 hour ago

asked 1 hour ago

asked 3 hours ago

asked 3 hours ago

asked 4 hours ago