Question

You borrow $15,000 for your tuition costs. You agree to make payments at the end of each month for the next 10 years. If the interest rate on this loan is 6%, how much is your monthly payment? How much do you still owe after 20 payments?

Answer #1

>>>>

Loan Amount = PV = $15,000

n = 10 *12 = 120 months

r = monthly interest rate = 6%/12 = 0.5%

Monthly loan payment = [r*PV] / [1 - (1+r)^-n]

= [0.5%*$15,000] / [1 - (1+0.5%)^-120]

= $75 / 0.450367267

= $166.530753

Therefore, Monthly loan payment is $166.53

>>>>

x = payments made = 20

P = monthly loan payment = $166.53

Remaining loan amounr = P * [ 1- (1+r)^-(n-x)] / r

= $166.53 * [1 - (1+0.5%)^-(120-20)] / 0.5%

= $166.53 * 0.392713224 / 0.005

= $13,079.7066

Therefore, remaining loan amount after 20 payments is $13,079.71

Your friend will loan you the money you need today if you agree
to make payments of $110 a month for the next 18 months. The friend
requires that the first payment be made today (i.e. immediately
after the loan amount is disbursed). The friend charges you
interest at 21.00% compounded semi-annually. How much money are you
borrowing today?
Question 3 options:
$1,725
$1,768
$1,811
$1,854
$1,898

If you borrow $1,800 and agree to repay the loan in four equal
annual payments at an interest rate of 10%, what will your payment
be? (Do not round intermediate calculations. Round your
answer to 2 decimal places.)
b. What will your payment be if you make the first
payment on the loan immediately instead of at the end of the first
year? (Do not round intermediate calculations. Round your
answer to 2 decimal places.)

a. If you borrow $1,700 and agree to repay the loan in six equal
annual payments at an interest rate of 11%, what will your payment
be? (Do not round intermediate calculations. Round your answer to 2
decimal places.)
b. What will your payment be if you make the
first payment on the loan immediately instead of at the end of the
first year? (Do not round intermediate calculations. Round
your answer to 2 decimal places.)

Your friend needs to borrow $26,995 from a credit union to pay
tuition at a local college. The credit union charges a 3.5% nominal
annual rate. The terms of the loan require that your friend make 12
equal end of month payments each year for 4 years and then an
additional final ballon payment of $7,500 at the end. What would
the equal monthly payments be

If you can earn 6.5% in simple interest on an investment of
$15,000, how much will you have in seven years?
Suppose you borrow $35,000 and you are going to make annual
payments of $3,000 for nine years. What interest rate are you
paying on the loan?
Another bank will let you borrow the $20,000 for your new car.
You can still borrow at 7% per year. If you take the 3-year loan,
what are your monthly payment?

You borrow $20,000 to buy a car using a 72 month, 4% loan. After
two years, how much do you owe on the loan?
After two years, how much of that loan payment (the 25th
payment) will go towards interest?

You have $1,000 on your credit card and your credit card company
charges 24% annual rate on the money that you owe to it. You
decided to make a payment of $200 each month at the end of the
month. How much money do you still owe to your credit company after
making 2 monthly payments?

You borrow $10,000 on January 1 and agree to pay off the loan
with 10 annual end-of-year payments. Your annual effective interest
rate is 5%. Complete the loan amortization table shown below for
payment number 5 and payment number 6.
Payment number Payment Amount
Principal Interest Loan Balance After Payment
5
6

You bought a house for 150,000. The bank required a
20% down payment and gave you a 30-year mortgage loan for the
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payment? After 18 years of payments, how much do you
still owe?

You received a loan from a bank for $100,000 at an interest rate
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payments over the next 10 years.
Calculate:
1. your monthly payment
2. how much you owe after 5 years of payments
3. how much of the first payment went to interest
4. wow much of the first payment went to principal

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