Claire needs to borrow $7000 to pay for NHL season tickets for her family. She borrows from a credit union with 48 monthly payments of $187.91 each. Suppose the credit union uses the rule of 78 and imposes an early payoff penalty of 1% of the original finance charge per month of early payment. For example, if Claire pays the loan off 9 months early, then the penalty will be 9% of the original finance charge. Find the least value of k that would result in any savings for Claire. The least value of k that would result in any savings for Claire is

Claire needs to borrow $7000 to pay for NHL season tickets for her family. She borrows from a credit union with 48 monthly payments of $187.91 each. Suppose the credit union uses the rule of 78 and imposes an early payoff penalty of 1% of the original finance charge per month of early payment. For example, if Claire pays the loan off 9 months early, then the penalty will be 9% of the original finance charge. Find the least value of k that would result in any savings for Claire. The least value of k that would result in any savings for Claire is

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter5: The Time Value Of Money

Section: Chapter Questions

Problem 15P

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