Answered: Carlo paid P 13,500 after two years to…

Carlo paid P 13,500 after two years to fully pay his loan that costs P 10,000. What is the interest rate of the loan if the money is to be compounded quarterly?

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter19: Lease And Intermediate-term Financing

Section: Chapter Questions

Problem 18P

See similar textbooks

Related questions

Q: The Flemings secured a bank loan of $368,000 to help finance the purchase of a house. The bank…

A: Calculation for the size of each repayment if loan is to be amortized at the completion of the term:…

Q: to settle a debt of 40000, Mrs santiago will pay quarterly for 7 years at 14% compounded quarterly.…

A: Future Value: The future value is the amount that will be received at the end of a certain period.…

Q: You borrowed $650,000 from a bank at an interest rate of 63% compounded quarterly to purchase a new…

A: Monthly payments can be calculated by present value of annuity as the money borrowed (Loan) is the…

Q: Alexander Michael owes P25,000.00 due in 1 year and P75,000 due in 4 years. He agrees to pay…

A: Amount owed in one year = 25,000 Amount owed in four years = 75,000 Amount paid today = 60,000…

Q: Mang Moises needed a refrigerator for his canteen. The refrigerator, which costs P:26,000, may be…

A: In financing, amortization is the amount of loan, in which principal loan paid according to the…

Q: Mr. Cama borrowed one million pesos from a bank to buy a house which he would pay in 15 years. How…

A: Calculation of monthly payment to be paid on the loan if compounded annually::: Cost of the…

Q: If Rachel obtained a business loan of $205,000.00 at 4.49% compounded semi-annually, how much should…

A: Present value of annuity Annuity is a series of equal payments at equal interval over a specified…

Q: Morris paid £500 a month for 20 years to pay off the mortgage on his Glasgow house. If his down…

A: given information interest paid monthly = £500 time period = 20 years = 240 months down payment =…

Q: Andy borrowed P20,000 with interest at 4% compounded quarterly. He agreed to pay P1,500 at the end…

A: Given: Loan =P20,000 Interest rate = 4% compounded quarterly So, quarterly rate = 0.04/4 =1%…

Q: You overhear your friend saying that he is repaying a loan at P5,000 every month for the next three…

A: Using excel PV function

Q: Javion Minerva owes P25,000 due in 1 year and P75,000 due in 4 years. He agrees to pay P50,000 today…

A: Effective interest rate refers to the rate which is calculated by computing the effect of…

Q: Mr. Reyes borrows 600000 at 12% compounded annually agreeing to repay the loan in 15 equal annual…

A: Formulas:

Q: Joyce pays P 2,000 every two months to settle his obligations for two years at 8% compounded…

A: Bimonthly payment (B) = P 2000 r = 8% compounded bimonthly = 8%/6 bimonthly = 1.3333% n = 2 years =…

Q: a) i) Ali is paying off a loan by making $50 payments at the end of every month for 2 years, at 6%,…

A: Loan is a borrowed amount taken for the purpose of completing the shortage of funds. When an…

Q: Mr. Espiritu obtained a Php 470, 000 car loan that will be paid in full after 2 1/2 years. If…

A: Amount to be paid after two and a half years can be calculated as future value

Q: A loan of P30,000 was made with a rate of 15% annually. How many years will he pay an amount of P…

A: Loan amount is P30,000 Rate"r" is 15% Annually Total Interest paid is P6,000 Future Value is…

Q: How much of the original principal is still unpaid after he has made the 8th payment?

A: Get the annuity first using P = 600000,i =12%= 0.12 , n = 15 P= A*(1-(1+i)^-n)/i…

Q: I owe Php 50,000 which is due without interest at the end of 2 years. What should my creditor be…

A: As per the time value of money concept, individuals prefer to receive a sum of money at the earliest…

Q: Jaspreet orignally agreed to make two payments: one of $3,600 due in fourteen months and another…

A: The concept of the time value of money states that the current worth of money is more than its value…

Q: John made a down payment of RM20,000 toward the purchase of a car. He secured a 9-year loan from a…

A: Down payment (DP) = RM 20,000 Monthly payment (P) = RM 715 Period = 9 Years Number of monthly…

Q: Morris paid £500 a month for 20 years to pay off the mortgage on his Glasgow house. If his down…

A: Given:

Q: To help finance the purchase of a house and lot, a couple borrows P350,000. The loan is to be repaid…

A: Given Information : Amount borrowed = P350,000 Number of years = 8 Annual interest rate = 15%

Q: ousiness takes out a loan of $500 000 from a bank and agrees to repay th ing a fixed amount of $60…

A: Loans are paid by the annual equal payments that carry the payment of interest and payment for the…

Q: The Flemings secured a bank loan of $272,000 to help finance the purchase of a house. The bank…

A: Amount of loan "P" is $272,000 Interest rate is 4% per year Monthly interest rate "r" is…

Q: Ruth availed of a cash loan that gave her an option to pay P5,000 monthly for 1 year. The first…

A: Periodic Payment = P5,000 Time Period = 1 Year Frequency = 12 Interest rate = 5% Compounded…

Q: The Flemings secured a bank loan of $328,000 to help finance the purchase of a house. The bank…

A: Ordinary annuities are the PMTs which are made at the end of the period.

Q: A man borrows Php10,000 from a loan firm. The rate of simple interest is 15%, but the interest is to…

A: Actual interest rate here will be calculated by dividing interest by net amount received. Actual…

Q: Juancho is required to pay P1,800 at the beginning of each quarter for the next 3 years for his…

A: Due to compounding the interest on the increase with increase in compounding. So effective rate is…

Q: A man borrowed P400,000 from a lending institution which will be paid after 10 years at an interest…

A: Compounding is a process where the investor or trader pays interest on interest. In this, the…

Q: To help finance the purchase of a house and lot , a couple borrows P350,000. The loan is to be…

A: The interest rate is the proportion of a loan that is charged as interest to the borrower. It is the…

Q: Hugo loaned P200,000 from a local bank to be paid back uniformly in five years. How much will he pay…

A: The given problem can be solved using PMT function in excel. PMT function computes installment…

Q: Ahmad took out a loan for $7500 and was charged simple interest at an annual rate of 4.7%. The total…

A: Simple Interest = Principal * Rate of interest * [ Number of days / 365 ]

Q: Bry borrowed a certain amount from ABC lending corp. In their contract, Kem must pay PHP 150,000 in…

A: Payment amount after 3 years = PHP 150,000 Simple interest rate = 0.075 Period = 3 Years Loan amount…

Q: Gunther has to pay a loan he took out after a term of 5 years. If the principal amount is at $215…

A: The present value is the value of the sum received at time 0. It is the current value of the sum…

Q: The Clarks are arranging a $90,000 mortgage loan from their bank. The mortgage is to be amortized by…

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

Q: Hannah made a bank loan worth Php 200,550 with 5% interest compounded semi-annually (2 times in a…

A: A= P ( 1 + i/n)nt A = Future Value P = Principal Amount i = interest rate n = Number of times…

Q: Cassie paid P68 000 to a money lending company after one and a half years to fulfill er loan that…

A: We need to use RATE function in excel to calculate rate of interest Formula is…

Q: A man borrowed P 150,000.00 at 7% compounded monthly. If he is required to pay P 10,000.00 on the 1…

A: The borrower is required to pay regular payments every period to repay the debt.

Q: Yukihira paid a 10% down payment of P200,000 for a restaurant and agreed to pay the balance of…

A: Payment per period can be calculated using PMT function in excel. PMT(rate, nper, pv, [fv],…

Q: Jason's loan for $8500.00 is repaid by equal payments of $525.00 that are made at the end of every…

A: The formula for effective rate is: i=q1+rmmq-1Where, q is the new compounding and m is the old…

Q: An employee obtained a loan of P10,000 at the rate of 6% compounded annually in order to repair a…

A: Loan amount (PV) = P10,000 Interest rate = 6% Monthly interest rate (r) = [1+0.06]1/12 -1…

Q: Moon purchases a lot for $300,000. Moon agrees to pay $25,000 dollars at the end of each year. If…

A: Time has been precious in all perspectives, however in terms of finance, time has a monetary value.…

Q: Lea buys a sala set. She pays P2, 500 down payment and pays P1, 200 per month for 2 years. If…

A: Cash equivalent of Sala set = Down Payment + Monthly installments

Q: what is the total amount of the loan?

A: The total amount of loan can be calculated using the present value formula. The present value of…

Q: Sabel converted her loan to light payments which give her an option to pay PHP1,500 every quarter…

A: Answer: Calculation of the amount of the loan: Given: Quarterly payment (P) = PHP1,500 Number of…

Question

Carlo paid P 13,500 after two years to fully pay his loan that costs P 10,000. What is the interest rate of the loan if the money is to be compounded quarterly?

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 Formula to calculate accumulated loan balance

VIEW

Step 2 Calculation of interest rate

VIEW

Step by step

Solved in 2 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, accounting and related others by exploring similar questions and additional content below.

Similar questions

If Bergen Air Systems takes out a $100,000 loan, with eight equal principal payments due over the next eight years, how much will be accounted for as a current portion of a noncurrent note payable each year?
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?
Samuel Ames owes 20,000 to a friend. He wants to know how much he would have to pay if he paid the debt in 3 annual installments at the end of each year, which would include interest at 14%. Draw a time line for the problem. Indicate what table to use. Look up the table value and place it in a brief formula. Solve.
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?
Cost of Bank Loan Mary Jones recently obtained an equipment loan from a local bank. The loan is for 15,000 with a nominal interest rate of 11%. However, this is an installment loan, so the bank also charges add-on interest. Mary must make monthly payments on the loan, and the loan is to be repaid in 1 year. What is the effective annual rate on the loan (assuming a 365-day year)?