Assume that you plan to take a housing loan with a tenor of 20 year. The loan has to be repaid in equal monthly installments. Considering that the loan amount is Rs. 50 lakhs and the interest rate on loan is 9% p.a., what would be the equated monthly installment (EMI)?

Assume that you plan to take a housing loan with a tenor of 20 year. The loan has to be repaid in equal monthly installments. Considering that the loan amount is Rs. 50 lakhs and the interest rate on loan is 9% p.a., what would be the equated monthly installment (EMI)?

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: out a 36-month installment loan to finance a delivery van for $26,100. The payments are $987 per…

A: The given problem can be solved using FV function in excel. FV function computes outstanding loan…

Q: Suppose you want to borrow $20,000 for a new car. You can borrow at 8% per year, compounded monthly…

A: Amount to borrow= $20,000 Interest rate= 8% per year, compounded monthly (0.6667% per month) Time…

Q: of loan can you get if you pay $700 each month at a yearly rate of 0.89% for 10 yea

A: The given problem can be solved using PV function in excel. PV function computes loan amount for…

Q: Suppose you lend $11,500 to a friend at an APR of 10.00%. Your friend will pay you back beginning…

A: The periodic payment can be made monthly, quarterly, semi-annually or annually. Periodic payment is…

Q: Suppose you take out a 36-month installment loan to finance a delivery van for $26,100. The payments…

A: Loan amount =26100 Financial charges =9360 Monthly payment =985 Total =36 months Monthly financial…

Q: at period of time could you pay back a loan of $3000 by making monthly payments of $110 if interest…

A: Loans are paid by the equal amount of monthly payments these payments carry the payment of principal…

Q: Suppose you take out a 36-month installment loan to finance a delivery van for $26,100. The payments…

A: Loan is amount borrowed by some investor or company from the stock market or taken by individual…

Q: You are considering taking out a loan of 20,000.00 that will be paid back over 7 years with monthly…

A: given information loan amount = 20,000 interest rate = 4.8% monthly interest rate = 0.004 no of…

Q: You are considering taking out a loan of 20,000 that will be paid back over 7 years with monthly…

A: Interest amount decreases and the principal paid amount increase as loan payments proceed further.

Q: Suppose you obtain a mortgage loan of $210,000 at an annual interest rate of 5.0%. How much less is…

A: The interest paid increases as the term of the loan increases.

Q: Suppose that your unsubsidized Stafford loans plus accumulated interest total $ 23000 at the time…

A: Given:

Q: You borrow $200,000 with a 25-year payback term and a variable APR thatstarts at 8% and can be…

A: Calculation of the initial monthly Payment is shown: Formulation is shown: To open the "PMT…

Q: Suppose you have a student loan of $35,000 with an APR of 12% for 30 years. The required…

A: As per the time value of money, a dollar is worth more today than the same dollar in the future.…

Q: Consider a 30-year fixed-rate home loan of $410,500 with an interest rate of 3.125%. What is the…

A: The monthly payment can be calculated with the help of present value of annuity function

Q: You are buying a house for $130,000.00 with a downpayment of $26,000.00. The loan will be paid back…

A: Concluding payment is calculated as under-

Q: A loan of P30,000 is to be repaid monthly for 5 years that will start at the end of 4 years. If…

A: Present value of deferred annutiy Present value of deferred annuity refers to the annuity which…

Q: Using the formula for an annuity, what would be the monthly payments on a 5-year fixed-rate car loan…

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

Q: Suppose that you have a plan to pay RO 0592 as an annuity at the end of n month for 20 years in the…

A: Hi There, Thanks for posting the questions. As per our Q&A guidelines, must be answered only one…

Q: A person is repaying a loan of $50000 at $200 per month. The interest rate is 3% per month. Form a…

A: PMT is the periodic payment made.

Q: What would be r in this problem? A P100,000 loan is to be paid monthly for 2 years with an interest…

A: Interest rate = 10% per annum semiannually compounded Compounding frequency = 2 Let the monthly…

Q: You are considering taking out a loan of $14,000.00 that will be paid back over 8 years with monthly…

A: Equity in a home refers to how much of that home's value a person has already invested in it.

Q: Consider a five-year floating rate loan with principal of $10 million and quarterly payments based…

A: Given information: 5 year floating rate loan of $10 million

Q: If you borrow $2,200 and agree to repay the loan in five equal annual payments at an interest rate…

A: Loan means lending money by one or more individuals or organizations to other individuals or…

Q: Find effective rate of interest for a housing loan having an Equated Monthly Instalment of Rs.…

A: Effective rate of interest is acknowledged as the actual return earned received by a lender or paid…

Q: 1.Suppose that a client borrows a loan amount of R50,000 at annual interest rate of 10% compounded…

A: Interest is the periodic obligation of the borrower to pay towards the sum borrowed. It is computed…

Q: Compute the monthly payment on a $65,000 loanif the principal and interest are to be repaid in 84…

A: a) Loan amount (PV) of $65,000 needs to be repaid in (n) 84 equal installments at an annual interest…

Q: Suppose you take out a fixed payment loan of £1000 for 5 years. You will repay it in annual…

A: Hi There, Thanks for posting the questions. As per our Q&A guidelines, must be answered only one…

Q: A loan should be fully repaid in 30 monthly installments of Rp3.750.000. If the loan is…

A: Flat interest rate is simple interest rate without considering the impact of the compounding and…

Q: Assume you borrow $2000 now at 7% per year for 10 years and must repay the loan in equal yearly…

A: PV=2000 N=10 r=7%

Q: You have just purchased a home by borrowing $400, 000 for 30-years at a fixed APR of 3.87%. The loan…

A: Answer. APR means Annual periodic interest rate

Q: A loan is to be repaid quarterly for 5 years that will start at the end of 2 years. If interest rate…

A: The Loan amount will be equal to the present value of payments today. Effective quarterly interest…

Q: Consider a loan of 25000 for a period of 30 years at a fixed apr of 9.5% the monthly payment is

A: Given information: Loan amount is 25,000 APR is of 9.5% Number of years (period) is 30

Q: Suppose you take out a 36-month installment loan to finance a delivery van for $26,100. The payments…

A: The loan amount is $26,100 The monthly payment is $989 The total finance charge is $9,504 The loan…

Q: Suppose you have two loans: one SR 2500 that is due 3 months from now with 5% annual simple interest…

A: Given information: There are two loans : Loan 1 : SR 2500 Loan 2 : SR 1500 Time period : Loan 1 : 3…

Q: Someone is borrowing from a five-six ( Bumbay ) money lender. How much will be charged if you want…

A: Interest is referred to as the monetary charge which is to be paid to the moneylender on the…

Q: Consider a 30-year fixed-rate home loan of $565,500 with an interest rate of 4.25%. What is the…

A: Loan amount (P) = $565,500 Interest rate (r) = 4.25% Period (t) = 30 years

Q: Suppose that your unsubsidized Stafford loans plus accumulated interest total $ 34000 at the time…

A: Loan amount (P) = $34000 Monthly interest rate (r) = 0.00625 (0.075 / 12) Monthly period (n) = 120…

Q: If you take out an amortized loan of $33,000 with a 14 year term and 7.4% interest rate, what are…

A: Using excel pmt function

Q: Suppose that one has a present loan of $1,000 and desires to determine what equivalent uniform EOY…

A: EOY payments is the abbreviation for end of year payments which is the payment made at the end year.…

Q: You plan to take a personal loan of Rs.50,000 at a rate of 12% per annum to buy a computer. The loan…

A: Given: Loan amount = 50,000 Interest rate =12% Years = 5years 3360.7853798

Q: Suppose you take out a 36-month installment loan to finance a delivery van for $26,100. The payments…

A: some borrowers who take installment loan wishes sometimes to prepay installments, so they are…

Q: Suppose you take out a 36-month installment loan to finance a delivery van for $26,100. The payments…

A: 1.Amount of Loan pay off is $7975 2.Amount of Finance Charges rebate is $2882 Calculations :-…

Q: ou are offered an add-on loan for $4,500 at 18% for 5 years. What is the monthly payment? What is…

A: Since we answer up-to three sub-parts, we shall answer first three. Please resubmit a new question…

Q: A $60,000 loan with interest at 6% compounded quarterly is being paid off with monthly payments of…

A: The notion of the time value of money (TVM) states that an amount of money is worth more now than it…

Q: You are considering taking out a loan of $10,000.00 that will be paid back over 12 years with…

A: We need to use loan amortisation formula to calculate unpaid balance of loan Unpaid balance(P)…

Q: what will be your monthly payment?

A: Sum of money borrowed if not paid immediately, then over a period of time as per agreement is…

Q: Suppose you take out a 36-month installment loan to finance a delivery van for $26,100. The payments…

A: Loan payoff will be the closing balance at the end of 25 months

Question

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

Step 1

VIEW

Step 2

VIEW

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Similar questions

Calculating interest and APR of installment loan. Assuming that interest is the only finance charge, how much interest would be paid on a 5,000 installment loan to be repaid in 36 monthly installments of 166.10? What is the APR on this loan?
Calculating single-payment loan amount due at maturity. Stanley Price plans to borrow 8,000 for five years. The loan will be repaid with a single payment after five years, and the interest on the loan will be computed using the simple interest method at an annual rate of 6 percent. How much will Stanley have to pay in five years? How much will he have to pay at maturity if hes required to make annual interest payments at the end of each year?
Define the stated (quoted) or nominal rate INOM as well as the periodic rate IPER. Will the future value be larger or smaller if we compound an initial amount more often than annually—for example, every 6 months, or semiannually—holding the stated interest rate constant? Why? What is the future value of $100 after 5 years under 12% annual compounding? Semiannual compounding? Quarterly compounding? Monthly compounding? Daily compounding? What is the effective annual rate (EAR or EFF%)? What is the EFF% for a nominal rate of 12%, compounded semiannually? Compounded quarterly? Compounded monthly? Compounded daily?
Calculating and comparing add-on and simple interest loans. Eli Nelson is borrowing 10,000 for five years at 7 percent. Payments, which are made on a monthly basis, are determined using the add-on method. a. How much total interest will Eli pay on the loan if it is held for the full five-year term? b. What are Elis monthly payments? c. How much higher are the monthly payments under the add-on method than under the simple interest method?
You want to invest $8,000 at an annual Interest rate of 8% that compounds annually for 12 years. Which table will help you determine the value of your account at the end of 12 years? A. future value of one dollar ($1) B. present value of one dollar ($1) C. future value of an ordinary annuity D. present value of an ordinary annuity
Suppose that one has a bank loan for P15,584.48, which is to be repaid in equal end-of-month installments for 9 years with a nominal interest rate of 0.114 compounded monthly. What is the amount of each payment?
Answer the Situation below correctly show your complete solution. A loan of 30 000.00 Php is to be paid monthly for 5 years that will start at the end of 4 years . If converted monthly at 12 % , how much is the monthly payment ?a . The type of annuity illustrated in the problem is _________________.b. The total number of payments is ______.c . The number of conversion period in the period deferral is ___________________.d. The interest rate per period is _________.e . The present value of the loan is_______.
Suppose that one has a present loan of $1,000 and desires to determine what equivalent uniform EOY payments, A, could be obtained from it for 10 years if the nominal interest rate is 20% compounded continuously (M =∞).
Consider a five-year floating rate loan with principal of $10 million and quarterly payments based on the three-month bbalibor rate. Suppose the bbalibor rates are 0.01 for the first three years and 0.02 for the last two years. What is the value of the floating rate loan when it is issued? Write your answer in millions of dollars without the $