12- a loan that requires the borrower to maket he same payment every period until the maturity date is called a . ? Please select one; a) simple loan b) discount loan c) faixed-payment loan d) same-payment loan e) none of the above

12- a loan that requires the borrower to maket he same payment every period until the maturity date is called a . ? Please select one; a) simple loan b) discount loan c) faixed-payment loan d) same-payment loan e) none of the above

Fundamentals of Financial Management, Concise Edition (with Thomson ONE - Business School Edition, 1 term (6 months) Printed Access Card) (MindTap Course List)

8th Edition

ISBN:9781285065137

Author:Eugene F. Brigham, Joel F. Houston

Publisher:Eugene F. Brigham, Joel F. Houston

Chapter15: Working Capital Management

Section: Chapter Questions

Problem 8Q

See similar textbooks

Related questions

Q: Use the ordinary interest method to compute the time (in days) for the loan. Round your answer up to…

A: Given Principal is $7100 Rate is 10.4% Interest $225.

Q: A contractual agreement in which the borrower receives something of value now and agrees to pay the…

A: The answer and the explanation can be seen below:

Q: 2.A certain loan was to be amortized based on the schedule below at 15% interest. What is the…

A: Solution : Let us first find the net present value of the year end payment using 15% interest rate…

Q: Find the interest on the loan using the Banker's rule. P= $2.000, r= 11%, 1 = 90 days

A: Given information: Principal (P) is $2,000 Interest rate (r) is 11% Number of days is 90

Q: Under what conditions would the simple interest rate, or APR (remember rSIMPLE APR), equal the…

A: Since, two dissimilar questions were posted together, the answer for the first question is only…

Q: effective interest rate on a loan

A: Effective interest rate refers to the return on the savings account at the time compounding effects…

Q: LC6Q 3) The payment is a partial payment of the cash price paid at the time of sale. Mortgage Cash…

A: While taking any kind of loan , we need to pay some amount as down payment and rest will be the loan…

Q: Give an example of a loan repayment plan.Show at least 3 payment entries including the end of period…

A: The funds acquired by the borrower is repaid either in lumpsum amount at a future date i.e. at the…

Q: Identify the types of information that can readily be deter-mined from an amortization table for an…

A: Meaning of amortization table Amortization table is a table which consists of all the details…

Q: A forward rate is a borrowing/lending rate for a loan to be made at some future date. Select…

Q: Calculate the missing information for the installment loan that is off early. Sum-of-the-…

Q: When a decision is made to reject the discount and pay on the last day of the loan term, there is a…

A: A loan discount involves lower interest charges and other costs. At times the entire discount amount…

Q: .The portion of the selling price paid by the customer at the time of purchase is called ________.…

A: Customers have to pay some amount to purchase on loan.

Q: Outstanding Regular Payment Principal Component of Payment Period Interest Balance Component of…

A: A = Loan amount = 100,000.00 B = Regular Payment = 31,547.08 C =…

Q: In a mortgage loan that requires periodic paym= fully amortize the loan, the final that do not ment…

A: Mortgage securitization is the process of clubbing mortgages of individuals having same features to…

Q: All of these have a balloon payment due at the end of the loan term EXCEPT a.a fully amortized…

A: A balloon loan is a type of loan that which do not fully amortize during the tenure of the loan. As…

Q: installment loan at 18%. The final payment is to be made on $238.42 principal.what is the final…

A: Loan: It refers to the amount of credit given by the lender to the borrower. The borrower makes…

Q: 10.) Which one is the contractual equation for buying an FRA? a.) Loan with maturity t2 plus Deposit…

A: Forward rate agreement: It is a financial contract and a forward contract on the interest rate in…

Q: Which of the following is subject to change over the life of an adjustable-rate mortgage loan?…

A: An adjustable-rate mortgage is a mortgage where the interest rate applied on the outstanding balance…

Q: The following loan is paid in full before the date of maturity. Find the amount of uneaned interest.…

A: There are various method which can be used to compute the interest charged on a loan. Rule 78 is one…

Q: As a loan is paid off, the monthly payment increases debt and interest portions do not change each…

A: Interest expenses on loan is calculated on the closing balance of the loan account on a particular…

Q: Determine the maturity date of the loan (not in a leap-year). Loan Date Time of Loan (days)…

A: Loan date = Feb 8 Loan duration = 110 days As it is not a leap year, Feb has 28 days

Q: . Calculate the amount of the interest expense for each option. $fill in the blank 1 for…

Q: What type of loan requires both principal and interest payments as you go by making equal payments…

A: Interest-only loan:The borrower only pays the interest on the mortgage through monthly payments for…

Q: Question 14 When evaluating a loan you should make sure you know the annual interest rate, length of…

A: Annual interest rate is the yearly interest charged on a loan

Q: The repayment of a loan in a series of equal periodic payments is called. O a. Mortgage O b. Down…

Q: Calculate the missing information for the installment loan that is being paid off early. Number of…

A: Number of payments = 18 Payments made = 3 Payments remaining = 18 - 3 = 15 2. sum of the digit of…

Q: Required Correct Option 1- The amount which borrower has to pay to lender for taking and using his…

A: Issuing the financial instruments will increase the capital , as well as the capital of the company.…

Q: Apply the United States rule to determine the balance at maturity and the total interest paid if the…

A: As per the United States rule, the partial payment made against a loan is first adjusted against the…

Q: A borrower has two alternatives for a loan: (1) issue a $300,000, 120-day, 8% note or (2) issue a…

A: A Notes payable is the written promissory note in which one party agrees to pay the sum of amount to…

Q: 11. In an amortization problem, the outstanding principal at the beginning of the term is the…

A: Laon amortization schedule means where repayment during the life of loan is written with interest.…

Q: At the maturity of a note payable, a borrower will pay ________. A. the interest amount only…

A: Note payable: Note payable is also referred as promissory note. In this, borrower obtains a…

Q: Which of the following is true when the mortgage loan is an amortizing loan? a. At the beginning of…

A: Borrowings are the liability of the company which is used to finance the requirement of the funds.…

Q: 1. In a loan amortization schedule, interest payments for each period would most probably a.…

A: Note: Given situation consists of multiple questions and in this situation, no specified one…

Q: If an installment loan is paid in full before the maturity date, the full amount of interest on the…

A: Loan is the amount which borrower takes from lender on a certain cost which is called as interest.

Q: a. How many payments are required to settle the loan? Round to the next payment b. Complete the…

A: Amortization Schedule: It represents a table comprising interest payments, principal payments, the…

Q: Calculate the missing information for the installment loan that is being paid off early. Number of…

A: Sum of the digits for n payments S = (n(n+1))/2 where n is the number of payments

Q: What amount should be paid on the maturity date to settle a one-hundred-twenty day loan dated March…

A: Interest = Principal * rate * time Interest = 15600 * 13.2857% * 120/365 Interest = 681.39

Q: Use MV = P(1 + RT) to find the maturity value (in $) of the loan. Principal Rate (%) Time Maturity…

A: Given Principal $15,660. Rate is 11 1/2% number of months is 42.

Q: When calculating interest on loans with terms of days, there are two methods. Ordinary interest…

A: Ordinary interest is a simple interest that uses 360 days as the equivalent number of days in a…

Q: Calculate the missing information for the installment loan that is being paid off early. Number of…

A: Rebate fraction is the ratio between sum of digits of payment remaining to number of payments. Sum…

Q: 26) The cash payment or PMT for a Note Payable (installment loan) includes only interest on the…

A: Note means an instrument acknowledging as debt due from one party to another party. It carry defined…

Q: Calculate the missing information for the installment loan that is being paid off early. Sum-of-the-…

A: Loan is a value or amount which is borrowed from other sources like banks and repay it later with…

Q: in.......................all of the interest is paid at end of the term

A: Interest payment refers to the amount that a borrower pays on the loan amount acquired by him for an…

Q: A borrower has two alternatives for a loan: (1) issue a $360,000, 60-day, 5% note or (2) issue a…

A: Discount on notes payable arises when proceeds from notes payable is less than the face value of the…

Concept explainers

Risk and return

Before understanding the concept of Risk and Return in Financial Management, understanding the two-concept Risk and return individually is necessary.

Capital Asset Pricing Model

Capital asset pricing model, also known as CAPM, shows the relationship between the expected return of the investment and the market at risk. This concept is basically used particularly in the case of stocks or shares. It is also used across finance for pricing assets that have higher risk identity and for evaluating the expected returns for the assets given the risk of those assets and also the cost of capital.

Question

12- a loan that requires the borrower to maket he same payment every period until the maturity
date is called a .?
Please select one;
a) simple loan
b) discount loan
c) faixed-payment loan
d) same-payment loan
e) none of the above

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Introduction

VIEW

Explanation

VIEW

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, finance and related others by exploring similar questions and additional content below.

Similar questions

Define each of the following loan terms, and explain how they are related to one another: the prime rate, the rate on commercial paper, the simple interest rate on a bank loan calling for interest to be paid monthly, and the rate on an installment loan based on add-on interest. If the stated rate on each of these loans was 4%, would they all have equal, effective annual rates? Explain.
What would the loan payment amount and the interest payed for Kevan’s loan be if the PV=8500, PMT=495.74, FV=0, Rate=6.2, Period=18, Payment Frequency=12, and Compounding=monthly
Calculate the missing information for the installment loan that is being paid off early. Number ofPayments PaymentsMade PaymentsRemaining Sum-of-the-Digits PaymentsRemaining Sum-of-the-Digits Numberof Payments RebateFraction 18 7
33 .The portion of the selling price paid by the customer at the time of purchase is called ________. a. Mortgage b. Amortization c. Down payment d. Installment loan
Which of the following is true of a fully amortized loan? A. The amount of the payment applied to the principal remains the same during the loan period. B. Equal amounts of the payment are appiled to the principal Interest, taxes, and insurance. C. Additional payments applied to the interest during the loan period reduce the number of monthly payments required. D. Additional payments applied to the principal during the loan period reduce the number of monthly payments required
9-9 Under what conditions would the simple interest rate, or APR (remember rSIMPLE APR), equal the effective annual rate, rEAR? 9-10 What is an amortized loan? What is an amortization schedule and how is it used?
Which of the following statement is true of amortization? The computation of loan amortization is wholly based on the computation of simple interest. Amortization solely refers to the total value to be paid by the borrower at the end of maturity. The amortization schedule represents only the interest portion of the loan. The amortization schedule provides principal, interest, and unpaid principal balance for each month. In a typical loan amortization schedule: The amount of money paid towards reducing the loan balance decreases over time. The amount of interest paid each period does not remain constant. The amount of each payment does not remain constant. The amount of interest paid each period increases over time.
A person has an installment loan at 18%. The final payment is to be made on $238.42 principal.what is the final payment
4.-Among the following options are the main characteristics (purpose of the credit, term, interest collection and guarantees) of the Direct Loan. Choose the 4 correct answers. A) To finance the purchase of machinery B) Long term C) With real guarantees. D) With interest charged at maturity E) 30, 60, 90 days F) With interest collected in advance G) To finance working capital H) Without guarantees
(J) A borrower has two alternatives for a loan: (1) issue a $185,000, 60-day, 4% note or (2) issue a $185,000, 60-day note that the creditor discounts at 4%.a. Compute the amount of the interest expense for each option.b. Determine the proceeds received by the borrower in each situation.c. Which alternative is more favorable to the borrower? Explain.
2.A certain loan was to be amortized based on the schedule below at 15% interest. What is the equivalent annual uniform payment of the loan? End of Year Payment 1 P 7,000 2 P 6,500 3 P 6.000 4 P 5,500 5 P 5.000 6 P 4,500 7 P 4,000 a. P 5365.80 b. P 5333.00 c. P 6475.12 d. P 5775.08 PLEASE SHOW YOUR SOLUTIONS. THANK YOU!
13. Francis Company's bank require s a compensating balance of 20% on a P100,000 loan. If the stated interest of the loan is 7% , what is the effective cost of the loan?