Answered: 4 years. His Monthly loan was 23.03.…

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Finance

4 years. His Monthly loan was 23.03. What was the monthly payments and what was the total interest paid on his loans.

EBK CFIN

6th Edition

ISBN:9781337671743

Author:BESLEY

Publisher:BESLEY

Chapter4: Time Value Of Money

Section: Chapter Questions

Problem 25PROB

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Concept explainers

Cost of Credit

The cost of credit is an extra amount that the borrower has to pay besides the loan amount. These credit charges may vary from loan to loan. The cost of credit includes interest charges, maintenance charges, and arrangement charges. Some of the costs are mandatorily collected by the lender based on the loan amount and tenure of the loan. The cost of credit is also called finance charges of the credit.

Question

Franklin's new snowmobile cost $14,000. After his down payment of $2.000, he financed the remainder at 5% for 4 years. His Monthly loan was 23.03. What was the monthly payments and what was the total interest paid on his loans.

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