Which type(s) of loan can be repaid with annuity payments?
Pure discount loan
Both pure discount and interest-only loans
Amortized loan
Both interest-only and amortized loans
Interest-only loan
Amortization refers to repayment or paying of loan in regular intervals. These regular interest payments are called annuity. These payments may be in the form of ordinary annuity or annuity due. Over a period loan will be amortized.
Hence, correct option is Amortized loan.
Which type(s) of loan can be repaid with annuity payments? Pure discount loan Both pure discount...
An amortized loan is repaid with annual payments which start at $550 at the end of the first year and increase by $ 50 each year until a payment of $ 2,000 is made, after which they cease. If interest rate is 4% effective, find the amount of principal in the tenth payment. would prefer to understand the financial mathematics behind obtaining the solution, not using excel spreadsheet or financial calculator online
Explain without excel (3) An amortized loan is repaid with annual payments which start at $400 at the end of the first year and increase by $45 each year until a payment of $1,480 is made, after which they cease. If interest is 4% effective, find the amount of principal in the fourteenth payment.
Please post the work, so I can understand the process :) Which one of the following describes a loan wherein payments are even (equal) in amount and include both interest and principal? A. amortized loan B. modified loan C. balloon loan D. pure discount loan E. interest-only loan There are two annuities that offer monthly payments of $1,500 for five years and pay 0.18 percent interest per month. Annuity A will pay you on the first of each month while...
Explain the differences between Pure Discount Loans and Interest Only Loans. Is a Treasury Bill considered a Pure Discount Loan or an Interest Only Loan? Why?
** USE FORMULA TO SOLVE THIS PROBLEM (NO EXCEL PLEASE!!!) (3) An amortized loan is repaid with annual payments which start at $400 at the end of the first year and increase by $45 each year until a payment of $1,480 is made, after which they cease. If interest is 4% effective, find the amount of principal in the fourteenth payment
I need the payments, interest in payments, principal repaid, prinicipal owing at end of year for both year 1 and 2. Hep You borrow $400,000 to buy a house over a 25-year term. The loan is structured as an amorrtized loan with anmual payments and an interest rate of 11% Complete the cells in the amortization schedule, below Interest in Principal Principal Owing at End of Year ($) Year Payment (S) Repaid (5) Payment () 1 Principal Repaid () Interest...
Which one of the following is type of an agency cost?: A. accepting an investment opportunity that will add value to the firm B. increasing the quarterly dividend C. investing in a new project that creates firm value D. hiring auditors the company's financial statements E. closing a division of the firm that is operating at a loss Tom invested $100 two years ago at 10 percent interest. The first year, he earned $10 interest on his $100 investment. He...
A 10-year loan of 2000 is to be repaid with payments at the end of each year. It can be repaid under the following two options: (i) Equal annual payments at an annual effective interest rate of 5%. (ii) Installments of 200 each year plus interest on the unpaid balance at an annual effective interest rate of i. The sum of the payments under option (i) equals the sum of the payments under option (ii). Calculate i.
A loan of 16,000 is repaid by 8 annual payments starting 1 year after the loan is made. The amount of the first 2 payments is X and the amount of the last 6 payments is 2X. The effective annual interest rate is 6%. Find: a. X. b. OB7 providing formulas for both the retrospective and prospective calculation approaches.
QUESTION 4 You are given two loans, with each loan to be repaid by a single payment in the future. Each payment includes both principal and interest. The first loan is repaid by a 3000 payment at the end of four years. The interest is accrued at an annual nominal rate of discount equal to 5% compounded semiannually. The second loan is repaid by a 4000 payment at the end of five years. The interest is accrued at an annual...