Assuming you have seen a car displayed in a mall with installment price of 500,000 with no interest. It is payable in installments of 10,000 at the end of each month. How much is the cash price of the car if the prevailing market rate of interest is 10% per year?

Q: You want to buy a boat, and a local bank will lend you $25,000. The loan will be fully amortized…

A: Loan amortization is the process of reimbursement of loan periodically by the borrower of the loan…

Q: You want to buy a $170000 home. You plan to pay $34000 as a down payment, and take out a 20 year…

A: Hi, since you have posted a question with multiple sub-parts, I will answer the first three…

Q: You need to have 59,173 dollars to buy a new car 5 years from now. How much do you need to save at…

A: An annuity is the sum total of all the periodic payments or investments made over the period of time…

Q: To buy a new car, you decided to take a loan of $100,000 to be repaid in quarterly installments for…

A: The actual value of payment is calculated using the given interest rate. The constant dollar value…

Q: t to buy a car worth ₱808,000 at Hyundai Branch through EastWest Bank’s 5-year car loan program.…

A: Hi There, thanks for posting the question. But as per Q&A guidelines, we must answer the first…

Q: Suppose you finance a $10000 car over 8 years at car an interest rate of 14% per month. How much is…

A: Loan amount (PV) = $ 10000 Period = 8 Years Number of monthly payments (n) = 8*12 = 96 Interest rate…

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: You want to buy a car, and a local bank will lend you $35,000. The loan would be fully amortized…

A: Financial management consists of directing, planning, organizing and controlling of financial…

Q: John Perez receives P 90,000.00 credit for his old automobile when buying a new model costing P…

A: The question can be solved as follows:

Q: Suppose you buy a $40,000 car and you 'put down' $5,000 and finance the rest for 72 months at 3.75%…

A: Solution:- When a loan is taken, the amount can be repaid as a lump sum payment or in instalments.…

Q: You wish to buy a $10,000 dining room set.  The furniture store offers you a three-year loan with an…

A: Given information: Present value or principal value is $10,000 Number of years of loan is 3 Interest…

Q: Your car loan requires payments of $1,000 per month over the next18 months and payments of $2,000…

A: The concept of time value of money will be used here. As per the concept of time value of money the…

Q: Today you purchase a previously owned Tesla Model 3 for $40,000. You make a down payment of $5,000…

A: Given The purchase price is $40,000 Down payment $5,000 Rate is 0.25% per month payable in 60…

Q: You borrow $18826 to buy a car. You will have to repay this loan by making equal monthly payments…

A: Borrowed amount is $18826 Time period is 5 years APR is 12% To Find: Monthly payment

Q: You want to buy a car, and a local bank will lend you $35,000. The loan will be fully amortized over…

A: An effective annual rate (EAR) is the actual rate of interest to be paid annually after taking…

Q: You want to buy a car, and a local bank will lend you $30,000. The loan would be fully amortized…

A: An effective annual rate (EAR) is the actual rate of interest to be paid annually after taking…

Q: Suppose you are getting a loan from a bank to purchase a feed business. The interest rate on the…

A: APR(Annual percentage rate) refers to annual cost paid by the borrower for the loan taken which…

Q: You buy a ten-year-old car for $12,000. You decide to pay $2000 down, and the used car dealer gives…

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

Q: 1. You want to buy a car, and a local bank will lend you $15,000. The loan will be fully amortized…

A: " Since this question contains multiple parts, we will answer only the first part for you. Kindly…

Q: You decide to buy a house costing $400,000. You pay $100,000 down, and the remainder will be paid in…

A: Loans are a way through which individual finance their big expenditures. These types of loans help…

Q: Suppose you wanted to buy a $200,000 house. You have $30,000 cash to use as the downpayment. The…

A: Given PV = amount of loan = 200000-30000 = $ 170000 r = rate of interest = 6/12 = 0.05 n = number of…

Q: A customer wants to buy a house with a cash value of 1,000,000 riyals, and the customer will pay 40%…

A: Future value is the value of the current assets or some amount that is invested today and amount…

Q: What is the monthly loan payment?

A: A personal loan is an unsecured loan and can be easily received without a need to pledge collateral…

Q: A service car whose cash price was ₱ 540,000 was bought with a down payment of ₱ 162,000 and monthly…

A: Annuity is a payment made in a fixed interval into a deposit or annual payment made for discharge of…

Q: Assuming you have seen a car displayed in a mall with installment price of P500,000 with no…

A: In the given question we need to compute the cash price of the car.

Q: You want to buy a new sports coupe for $84,500, and the finance office at the dealership has quoted…

A: APR refers to annual percentage rate. An APR is the annual rate that is charged for borrowing or can…

Q: You want to buy a car and therefore you borrowed $10,000 from a bank today for 6 years. The nominal…

A: Monthly Payment: It is the amount that is paid at the end of each month to the lender of the bond by…

Q: You want to buy a car, and a local bank will lend you $35,000. The loan will be fully amortized over…

A: Loan amount is the amount borrowed from the financial institutions such as banks, corporate houses,…

Q: You wish to buy a house. The market value of the house is $650,000 and you have saved $120,000 as a…

A: Interest Rate = 6.5% Time Period = 26 Years Market Value = $650,000 Down Payment = $120,000

Q: You are buying your first car for $20,000 and are paying $2,000 as a down payment. You have…

A: the monthly loan amount will be                                    = p*[ r(1+r)n/(1+r)n-1]…

Q: A payday lender lends money on the following terms: “If I give you $100 today, you will write me a…

A: An interest method in which current interest is computed by multiplying the interest rate by the sum…

Q: You want to buy a car, and a local bank will lend you $15,000. The loan will be fully amortized over…

A: Time value of money (TVM) refers to the concept which proves that the value of money today is higher…

Q: Assume that you are going to buy a new car worth $28,000. You will be able to make a down payment of…

A: Annual rate of return for dealer is the nominal annual interest rate that is charged by the dealer…

Q: You wish to have $4,000 in 2 years to purchase a new entertainment system. How much money (to the…

A: Future value of an annuity: It represents the future value of the present annuity stream of cash…

Q: You want to buy a car, and a local bank will lend you $35,000. The loan will be fully amortized over…

A: Loan is contract between lender and borrower where lender provide funds to borrower that is repaid…

Q: If a dealer offers you a car at $275 monthly payment for 5 years plus $5,000 down. If you can get a…

A: “Hey, since there are multiple questions posted, we will answer first question. If you want any…

Q: You make a down payment of $1,500 to purchase a used car worth $5,500.00 cash price and finance the…

A: Time value concept Receiving the value today is of more value than that of receiving the same amount…

Q: how much must he put down? (Round your answer to the nearest cent.)

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

Q: Assume you just deposited $1,000 into a bank account. The current real interest rate is 2% and…

A: Given data; Deposit amount = $1000 real interest rate = 2% inflation rate = 6%

Q: To purchase a new truck, you borrow $42,000. The bank offers an interest rate of 7.5% compounded…

A: Loan amount  $       42,000.00 Interest Rate 7.50% Time Period(Years) 5

Q: You want to buy a car and therefore you borrowed $10,000 from a bank today for 6 years. The nominal…

A: It can be calculated using PMT function in excel. PMT(rate, nper, pv, [fv], [type]) Rate The…

Q: Assume  you have secured a loan of $10,000 from a bank  which will be paid in one year. The bank has…

A: Interest payable = Opening Balance * Monthly interest rate

Q: You want to buy a $22,000 car. The car company is offering a 5% interest rate for 60 months (…

A: Installment amount is the amount of periodic payments a borrower has to make to its lender. It…

Q: a condominium unit is available at 29,000 monthly payable in 20 years. The first payment is due in 2…

A: The cash value for the condominium is the present value of $29,000 annuity which will be discounted…

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.