You borrowed $21,061.82 to finance the educational expenses for your senior year of college. You want to negotiate with the bank to defer the first loan installment until the end of year 2. (But you still desire to make five equal installments at 6% interest.) If the bank wishes to earn the same profit, what should be the new annual installment
The solution is as follows:
You borrowed $21,061.82 to finance the educational expenses for your senior year of college. You want...
A couple wishes to establish a college fund for their five year old child. The college fund will earn 8% interest (profit) compounded annually. Assuming the child enter college at age 18, the couple estimate that an amount of SAR30,000 per year, in term of today’s riyal, will be required to support the child’s college expenses for four years. College expenses are estimated to increase at an annual rate of 6%. Determine the equal annual deposit the couple must make...
Your brother-in-law borrowed $2,000 from you 4 years ago and then disappeared. Yesterday he returned and expressed a desire to pay back the loan, including the interest accrued. Assuming that you had agreed to charge him 10%, and assuming that he wishes to make five equal annual payments beginning in one year, how much would your brother-in-law have to pay you annually in order to pay off his debt? (Assume that the loan continues to accrue interest at 10% per...
estivgpRice is 45,000 You negotiate with the seller to buy the home for $5000 less than the listing price. You are able to make a 20% down payment. Your bank will finance a loan for the remainder of the price at 3.8% annual interest compounded annually. Compare a 15 year mortgage and a 30 year mortgage. What will your annual payment be for each? How much interest will you pay the bank for each type of loan? Decide which length...
Suppose you borrowed $15,000 at a rate of 8.5% and must repay it in 5 equal installments at the end of each of the next 5 years. How much would you still owe at the end of the second year, after you have made the second payment? Here we use an annual compounding. Hint: Amortization loan table.
You want to start saving for your daughter's college education now. She will enter college at age 18 and will pay fees of $4,000 at the end of each of the four years. You will start your savings by making a deposit in one year and at the end of every year until she begins college. If annual deposits of $2,458.79 will allow you to reach your goal, how old is your daughter now? Assume you can earn 6% annual...
On the day you entered college, you borrowed $30,000 from your local bank. The termsof the loan include an interest rate of 4.75 percent. The terms stipulate that the principalis due in full one year after you graduate. Interest is to be paid annually at the end ofeach year. Assume that you complete college in four years. How much total interestwill you pay on this loan assuming you paid as agreed? $7,400 $1,425 $1,500 $7,267 O $7,125
Please provide the answer showing all steps.
Suppose you borrowed $10,000 at an interest rate of 12%, compounded monthly over 36 months. At the end of the first year (after 12 payments), you want to negotiate with the bank to pay off the remainder of the loan in 8 equal quarterly payments. What is the amount of this quarterly payment, if the interest rate and compounding frequency remain the same?
Please show steps 13. You borrowed $20,000 from a local bank at 12% annual rate one year ago under the condition that you make equal quarterly payments over a five year period. Today, you made the fourth payment. What should be the balance of the loan after this payment?
1- Your rich aunt wants to finance four years of college for you. Assuming an annual cost of $19,000, how much money must she put in your college fund now to cover the entire cost of your college education if the fund earns 6% per year. 2- You just bought a used car for $7,000 with no down payment using dealer financing at 5% APR compounded monthly. If you make monthly payments of $500, how many months will it take...
Please answer the questions in an excel spreadsheet with formulas showing Part III: College Education You and your spouse just had a baby. Ecstatic with the outstanding education you received at the University of Pittsburgh, you want to send your baby to college in 18 years and be able to 1 pay for your baby’s college education. You need to estimate cost of each year of college (you’re only paying for the 4 years necessary to complete a bachelor’s degree)...