7. Ellen has a balance of $15,000 on her car loan and an interest rate of 2.75%. To pay off the $15,000 in five years, Ellen will have to make a minimum payment of $267.87. If Ellen pays $434.57 per month she can pay off her auto loan in 3 years instead. How much more wilI Ellen pay if she takes 5 years to pay off her loan instead of 3 years? Years x 12 x monthly payment = total repayment O A. $15,644.52 O B. $6,001.20 O C. $427.68 O D. $16,072.20

Q: Jimmy wants to buy a taxi 6 years later. He will need $550,000 as the down payment. He initially…

A: Part (a): Answer: Annual effective rate of interest is 6.14%

Q: 3) Jennifer buys a $300,000 house and pays $100,000 down. The loan is for 30 years and is at 4%…

A: A study that proves that the future worth of the money is lower than its current value due to…

Q: Supposed you want to buy a used car but your savings is not enough. To do this, you borrow P60,000…

A: Loan amortization is the process of scheduling out a fixed-interest rate loan into scheduled…

Q: What is the monthly payments you must make on this loan?

A: Pricipal=? n=60 months Rate=12%

Q: 4-19 Tina owes $12,000 on her automobile loan, which has an interest rate equal to 4.8 percent…

A: Compound interest: The amount of interest received or earned for multiple-interest time periods, on…

Q: Maria saves ​$32 at the end of each week and deposits the money in an account paying 12%…

A: A concept that implies the future worth of the money is lower than its current value due to several…

Q: 1. If money is worth 5% compounded quarterly, how much must Julea save every end of three months to…

A: Here we will use the concept of time value of money. As per the concept of time value of money it is…

Q: Ms. Tweeter is buying a house with a cost of $350,000. She will make a down payment of $20,000 on…

A: There are various ways through which one can obtain finance, one of them is through a mortgage loan.…

Q: isha is buying a car for $26,000. She has $1,800 for a down payment. She plans prrow the remainder…

A: Using the compounding technique, the future value of a sum has been used to know the future value of…

Q: (a) Heather borrowed $5000 from her grandmother as a down payment on her first car. She promised to…

A: Part-A Borrowed Amount is $5000 Time period is 2 years Interest rate is 7% Per annum To Find:…

Q: urt borrowed from a bank and wants to start paying P50,000 annually at the end of the 4th year. If…

A: In this we need to find the present value of payment today.

Q: Ingrid wants to buy a $22,000 car in 6 years. How much money must she deposit at the end of each…

A: Future Value = $22,000 Time Period = 6 Years Interest Rate = 5.8%

Q: 6. Genesus wants to buy a car. Her monthly income is $800, and she already has a credit card payment…

A: Debt to income ratio Monthly recurring debt / Gross monthly income

Q: Bobby Sue’s landlady has agreed to sell her the house she is renting for $260,000 in 4 years. Her…

A: Future Value of Annuity = PMT [((1 + r)n - 1) / r] r = periodic rate n = number of periods PMT =…

Q: 9. Aisha is looking for a $20,000 loan to buy a car. One financial institution has agreed to give…

A: Loan is a sum of amount borrowed from a lender. It is expected that the loan will be repaid at a…

Q: Thomas is planning to withdraw $7000 from a savings account at the end of each quarter for three…

A: Since you have asked multiple questions, we will solve the first question for you. If you want any…

Q: A woman buys a house for $265,000. She pays $70,000 down and takes out a mortgage at 6.6% on the…

A: Mortgage amortization refers to a schedule which is prepared to shows the periodic loan payments,…

Q: Ken wants to remodel his basement and he wants to pay back no more than $18,000. If he gets a low…

A: Given Information, Payment made after 3 years =$18,000 Interest rate =0.0375/2=0.01875(As the period…

Q: 4. You wish to purchase a house that costs $294,000, and the bank requires you to have 12% of the…

A: A down payment is an early stage payment made for a particular good purchased through financing.

Q: A) Suppose a young couple deposits $700 at the end of each quarter in an account that earns 7.6%,…

A: Future Value: The value of any asset at some future date which is computed using an assumed rate of…

Q: Arabella converted her loan to light payments which gives her an option to pay 12,000 every 2 years…

A: Present Value of annuity refers to the today's value of cash flows of a series of equal cash flows…

Q: A recent college graduate buys a new car by borrowing $16,000 at 7.2%, compounded monthly, for 5…

A: Any cashflow of equal instalments can be called as an annuity. A loan with equal repayments at equal…

Q: (a) Heather borrowed $5000 from her grandmother as a down payment on her first car. She promised to…

A: calculation of above requirement are as follows

Q: 4/ Julieta and Eric are purchasing a home. They wish to save money for 15 years and purchase a house…

A: The concept of time value of money states that the same amount of money has more value today than in…

Q: Bruce is paying $25,000 each year on his mortgage with 10 years of payments left and the next…

A: An installment amount is a periodic amount paid to repay a loan. The installment amount includes…

Q: 2. Suppose Sana borrows P8,500 from Momo to add to her son's tuition payment. She promises to pay…

A: Future Value: Using an expected rate of growth, future value (FV) is defined as the worth of a…

Q: Ann wants to buy an office building which costs $1,000,000. She obtains a 30 year fully amortizing…

A: Building Cost  $     10,00,000.00 LTV 80% Interest Rate 4% Time Period 30 Balloon Payment…

Q: Lucky Louie wants to buy a car that costs $26,750. The interest rate on his loan is 5.33 percent…

A: Car cost = 26750 Interest on loan = 5.33% Years = 7 Compounded = Monthly  PMT find out using Excel:…

Q: At an interest rate of 7 - %, Karen borrows $4,000 for 13 years. How much interest will she pay?

A: Concept: The interest is the product of principal, time period and number of years that is divided…

Q: If the rate of interest (r) is 9%, then you should be indifferent about receiving $7500 in one year…

A: Here we will use the concept of time value of money. As per the concept of time value of money the…

Q: Ann Marie is buying a new car from her local car dealership who offers financing. The purchase price…

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

Q: Beatrice takes out a 7 year loan of $5000. The interest rate is 4.5%. What are Beatrice's monthly…

A: In order to find the monthly payment one can use excel and in excel use PMT function.

Q: When Maria Acosta bought a car 2 years ago, she borrowed $12,000 for 48 months at 7.2% compounded…

A: Outstanding loan balance is calculated by present value of monthly payments left to be paid. r is…

Q: 4.Ben and Jen are looking at a home that has an annual property tax of $3700 and an average heating…

A: GDSR is the Gross debt service ratio. The maximum GDSR should not exceed 32%. Annual property tax…

Q: A student needs to borrow $7,000 to pay for college. She can get a loan at an APR of 10% to paid off…

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Q: Jonathan wishes to buy a used chevy malibu for $12,500. He only has $1,000 for a down payment so th…

A: a) Value of chevy malibu = $12,500 Down payment =$1,000 Loan Amount =$12,500 -$1,000 Loan amount…

Q: Heather has $13,000 to put down on a new car priced at $25,000. The bank offers an annual interest…

A: Since you have posted a question with multiple sub-parts, we will solve the first three subparts for…

Q: Ken wants a $1,000 TV/sound system. He can't afford that amount, so he uses a credit card with 20%…

A: It is an example of simple interest. An interest of 20%/12 is given every month on $1000 for a…

Q: 12. Pam promises to pay Sandy $4,000 in year 4 and another $6,000 in year 8 for a loan of $4,000…

A: For Sandy the cost = 4,000. It can also be said to be her initial cash outflow. Sandy's benefits or…

Q: Mary Smith took a car loan of $20,000 to make 60 equal monthly payments. The interest compounds…

A: Annual worth distributes present worth into equivalent uniform value over its useful life.

Q: 6. Mahmoud has to pay three equal payments of $50,000 for a house he is buying, The payments are at…

A: In this problem we have calculate present value of all payments and remaining payments.

Q: A recent college graduate buys a new car by borrowing $22,000 at 6%, compounded monthly, for 4…

A: since you have posted a question with multiple sub-questions, we will solve the first three…

Q: 1.) Miller likes to invest in annuity that will pay him Php. 5000 at the end of each month for 5…

A: Note : As per the guidelines, only first question will be answered. Kindly post the second question…

Q: Gerritt wants to buy a car that costs $31,250. The interest rate on his loan is 5.69 percent…

A: Information Provided: Car costs = $31,250 (Present value) Interest rate on loan = 5.69% compounded…

Q: A recent college graduate buys a new car by borrowing $16,000 at 6%, compounded monthly, for 5…

A: Payment of loan made in fixed installment which includes interest as well as portion of principal,…

Q: A year after buying her car, Anita has been offered a job in Europe.Her car loan is for $27,000 at a…

A: Since you have asked multiple questions, we will solve the first question for you. If you want any…

Q: Phil can efford $170 a month for 5 years for a car loan. If the annual interest rate is 3.9 percent…

A: Present Value of annuity refers to the present value of all the future payments of and series of…

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.