A loan of amount $3,000 is to be repaid with bi-monthly payments of $269.36 for two (2) years. Find the nominal rate of interest and the outstanding loan balance immediately after the 6th payment is made.

A loan of amount $3,000 is to be repaid with bi-monthly payments of $269.36 for two (2) years. Find the nominal rate of interest and the outstanding loan balance immediately after the 6th payment is made.

Corporate Fin Focused Approach

5th Edition

ISBN:9781285660516

Author:EHRHARDT

Publisher:EHRHARDT

Chapter4: Time Value Of Money

Section4.17: Amortized Loans

Problem 1ST

See similar textbooks

Related questions

Q: 2.54. Bennington Company has borrowed a certain amount from the bank that it will repay in 24…

A: Following are the given details: Monthly installment = $6000 Interest rate = 6% annual Time period =…

Q: 5. A loan is to be amortized via equal payments of Php 119, 764.71 each at the end of six months for…

A: The Principal amount, interest rate, number of the periodic payments, and payment amounts per period…

Q: A loan with an interest rate of 4.2% compounded quarterly was obtained for $45,000. The payments…

A: Loan Amount = $45,000 Payment Per month = $400 Time Period =12 Years Interest Rate = 4.2% compounded…

Q: 4. A loan is to be amortized for 7 years through equal payments of Php 48,532.49 each semiannually.…

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

Q: 3. When will a single payment of SR 2,200 discharge the debts of (a) SR 500 due in 4 months, (b) SR…

A: Single Payment Amount = 2200 Interest Rate = 9%/12 = 0.75% Debt Payments: Months Cash OutFlow 4…

Q: If a borrower repays RM 11430 at the end of two years, which includes RM 2430 interest at a rate of…

A: Repayment amount = RM 11430 Interest amount = RM 2430 Interest rate = 13.5%

Q: A loan of $2982 is repaid in three years. Find the amount of interest paid on the loan if it is…

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

Q: 2.A person got a loan of 200.000 € from Bank A at 12 % annual interest rate. The bond will be repaid…

A: Amortization table: It is the schedule showing repayment of the loan amount that includes principal…

Q: 5-37 AMORTIZATION SCHEDULE up an amortization schedule for a $25,000 loan to be repaid in equal…

A: Amortization refers to the payment of the borrowed amount in instalments regularly over a period of…

Q: the interest rate on a loan charging $748 simple interest on a principal of $2750 after 8 years. 3.…

A: In this we need to use simple interest rate formula.

Q: You have taken a personal loan from Bank Muscat for 15,000 OMR and charged with an interest rate of…

A: Loan Amortization Table is as under -

Q: 4. You borrowed $10,000 on a 10% discounted loan for a period of 8 months. a. What is the loan's…

A: Mortgage/ Borrowings: A mortgage represents a credit given to the borrower by the lender for the…

Q: A loan is to be amortized by n level annual payments of X where n > 5. You are given (1) The amount…

A: Let L = Loan amount Number of payments = n Annual payments = X Interest rate = r

Q: 5. A bank gives a loan to a company to purchase an equipment worth P1,000,000 at an interest rate of…

A: Formula for calculating the installment amount is: EMI formula = [P*r*(1+r)^n]/[(1+r)^n - 1]

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: Question 1 A-One Hundred-Thousand-dollar ($100,000) loan obtained today is to be repaid in equal…

A: Solution Note : As per the Q&A guideline we are required to answer the first 3 subparts only .…

Q: 2. A loan of P2,000 is made for a period of 13 months. from January 1 to-lanuary 31 the following…

Q: b) A man borrowed GH¢164,000 from a bank to help finance the purchase of a store. The bank charges…

A: Interest is the cost of borrowing money. It can be simple or compounded.

Q: Find the semiannual payments to repay a debt of P100,000 in 5 equal payments with interest at 12%…

A: An amortization schedule is defined as the table, which includes the complete detail of periodic…

Q: 5. Assume you deposit RM1,000 into a savings account every three months that compounds interest…

A: Compound interest is computed on the initial principal of a deposit or loan plus any accrued…

Q: A principal of amount C is invested today. The compound financial law is applied. For the first 5…

A: BECAUSE YOU HAVE POSTED MULTIPLE QUESTIONS, WE WILL ANSWER THE FIRST QUESTION ONLY, FOR THE…

Q: A debt of ₱10,000 with interest rate of 20% compounded semiannually is to be amortised by 5 equal…

A: Formula for present value :…

Q: 3. Fairytail firm borrows P200,000 for 6 years at 8%. At the end of 6 years, it renews the loan for…

Q: You have taken a loan of $5,000.00 for 4 years at 2.3% compounded monthly. Fill in the table below:…

A: We need to calculate the monthly payment(PMT) of loan by using this equation PMT…

Q: A loan of $6000 is being repaid with quarterly installments of P at the end of each quarter for 5…

A: Given, Loan amount is $6000 Term of loan is 5 years rate is 12% Payment is made quarterly.

Q: A loan of 7 quarterly payments of Php.8,300 is to be made, to pay for a loan at 10% compounded…

A: Principal (P) = Php 8300 Interest rate (r) = 0.1 No of periods (n) = 7 Interest rate per quarter…

Q: 1. A financing company charges 1.5% per month on a loan. Find the equivalent effective rate of…

A: The effective annual rate of interest (EAR) is calculated as the actual rate of return earned after…

Q: 3 a) The Moyers secured a bank loan of $224,000 to help finance the purchase of a house. The bank…

A: According to the time value of money concept, the value of a certain amount of money in the future…

Q: 6. From a borrower's perspective, interest if the fee paid on an amount of money, whether loaned or…

A: The questions are related to True or False. This is due to interest and fees, which is what a lender…

Q: 2. A mortgage has the following terms: Amount: $750,000 Rate: 6.25% Amortization (Years): 30 Term…

A: Hello. Since your question has multiple sub-parts, we will solve the first three sub-parts for you.…

Q: 3.1.1 An amortized loan has 10 annual payments at the end of each year starting one year from now.…

A: Here,

Q: A six-month bank loan in the amount of $12,000 had been obtained on September 1. Interest is to be…

A: Accrual Concept - According to this concept all the expenses incurred whether paid or not and all…

Q: 4- Bank America offers a stated annual interest rate of 5.0 percent, compounded quarterly, while…

A: To understand in which bank you should deposit your money, we need to calculate Effective interest…

Q: 3-1. What lump-sum amount of interest will be paid on a $10,000 loan that was made on August 1,…

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

Q: 2. Find the amount (in $) of interest on the loan

A: Interest: It is the monetary charge paid to the lender by the borrower for taking a loan. Interest…

Q: A business borrowed $50,000 at 8% compounded monthly. If the loan is to be paid in equal quarterly…

A: In this problem, the number of payment period and compounding is not the same, hence, we will first…

Q: following loan is fully amortizing. The loan is for $12,000 at 5% interest to be repaid over three…

A: Loan amortization can be defined as paying a fixed amount of money as loan repayment over a fixed…

Q: Calculate the interest to be paid on a loan of $80,000, for 90 days, at 9.5%

A: Given Principle = 80000 Rate = 9.5%

Q: A loan of £16,000 is repayable by six equal annual payments with the first payment to be made in one…

A: The PMT function or concept can be used to determine the periodic payments required to accumulate a…

Q: A business loan of P1,000,000 is to be repaid in full after 5 years. What is the amount to be paid…

A: Ans. For calculating the amount to be repaid we need to prepare a schedule of interest that accrues…

Q: . How much is the maturity value that must be paid to the creditor if the credit term is 5% of Php…

A: The maturity value will be aggregate of amount borrowed and amount of Interest.

Q: 6. A loan is to be repaid in 30 years with level annual payments made at the end of each year. The…

A: Given information: Principal paid in 3rd year : $400 Effective annual rate : 7%

Q: 7. The remainder on a home loan is refinanced by a bank. The refinanced loan is a 15-year loan for…

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

Q: A loan was made 3 years and 8 months ago at 7.5% simple interest. The principal amount of the loan…

A: A loan is a sort of debt that is taken on by an individual or another institution. The lender, which…

Q: A fully secured loan of P30,000 was to be amortized by 10 equal semi-annual payments, the first…

A: Loan amount (L) = P 30000 Total payments (n) = 10 r = 12% per annum = 6% semiannually Let semiannual…

Q: 4. A loan was made 3 years and 4 months at 12% simple interest rate. The principal amount of loan…

A: Present value is the sum of money of future cash flows today whereas future value is the value of…

Q: 10. A loan of $14,064was repaid at the end of 7 months. What size repayment check (principal and…

A: The conceptual formula in the mathematical equation:

Q: Find interest charged on a loan of P8,275 for 3 years at 11% compounded quarterly

A: The interest rate is that amount which is charged by a lender to a borrower and it is expressed as a…

Question

100%

5.5 (a) A loan of amount $3,000 is to be repaid with bi-monthly payments of $269.36 for two (2) years.

Find the nominal rate of interest and the outstanding loan balance immediately after the 6^th payment is made.

Expert Solution

This question has been solved!

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

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1 As per given question

Step 2 Solution

Step 3 Solution

Step 4 Final Answer

Trending now

This is a popular solution!

Step by step

Solved in 4 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

Marathon Peanuts converts a $130,000 account payable into a short-term note payable, with an annual interest rate of 6%, and payable in four months. How much interest will Marathon Peanuts owe at the end of four months? A. $2,600 B. $7,800 C. $137,800 D. $132,600
Everglades Consultants takes out a loan in the amount of $375,000 on April 1. The terms of the loan include a repayment of principal in eight, equal installments, paid annually from the April 1 date. The annual interest rate on the loan is 5%, recognized on December 31. (Round answers to the nearest cent, if needed.) A. Compute the interest recognized as of December 31 in year 1. B. Compute the principal due in year 1.
Campus Flights takes out a bank loan in the amount of $200,500 on March 1. The terms of the loan include a repayment of principal in ten equal installments, paid annually from March 1. The annual interest rate on the loan is 8%, recognized on December 31. (Round answers to the nearest whole dollar if needed.) A. Compute the interest recognized as of December 31 in year 1 rounded to the whole dollar. B. Compute the principal due in year 1.
A customer takes out a loan of $130,000 on January 1, with a maturity date of 36 months, and an annual interest rate of 11%. If 6 months have passed since note establishment, what would be the recorded interest figure at that time? A. $7,150 B. $65,000 C. $14,300 D. $2,383
For a repayments schedule that starts at the end of year 5 at $A and proceeds for years 6 through 40 as $2A, $3A...... What is the value A if the principal of this loan is $100,000.00 and the interest rate is 10% compounded annually?
5.1 Niles needs £650,000 to set up his business. Bank A is willing to lend him themoney under the following conditions: the loan is to be repaid in equal instalmentsat the end of each of the next ten years and the interest rate is 7%. Determine theinterest and principal components of the payments at the end of the third andeighth year. Explain the difference in the amounts of interest and principalpayment in the third year with corresponding figures for the eight year