Homework Help is Here – Start Your Trial Now!
Business
Finance
Consider the following loan: a 60-month, $45,000 car loan with a 12% APR, compounded monthly. Assume thnat right after you make your 50th payment, the balance on the loan is $9,480.78. How much of your next payment goes toward principal, and how much goes toward interest? Compare this with the principal and interest paid in the first month's payment ($551.00 toward principal and $450.00 toward interest in the first month). What is happening? ..... The amount that goes toward interest is $ 94.81. Round to the nearest cent.) The amount that goes toward the principal is $ 906.19. Round to the nearest cent.) Over time, as the loan is paid, the principal becomes of each payment has to cover interest and V of each payment can go toward so reducing the principal.

Consider the following loan: a 60-month, $45,000 car loan with a 12% APR, compounded monthly. Assume thnat right after you make your 50th payment, the balance on the loan is $9,480.78. How much of your next payment goes toward principal, and how much goes toward interest? Compare this with the principal and interest paid in the first month's payment ($551.00 toward principal and $450.00 toward interest in the first month). What is happening? ..... The amount that goes toward interest is $ 94.81. Round to the nearest cent.) The amount that goes toward the principal is $ 906.19. Round to the nearest cent.) Over time, as the loan is paid, the principal becomes of each payment has to cover interest and V of each payment can go toward so reducing the principal.

EBK CONTEMPORARY FINANCIAL MANAGEMENT
EBK CONTEMPORARY FINANCIAL MANAGEMENT
14th Edition
ISBN:9781337514835
Author:MOYER
Publisher:MOYER
Chapter19: Lease And Intermediate-term Financing
Section: Chapter Questions
Problem 17P
See similar textbooks
icon
Related questions
Question
100%

The third box is also "less or more".

Consider the following loan: a 60-month, $45,000 car loan with a 12% APR, compounded monthly. Assume that right after you make your 50th payment, the balance on the loan is $9,480.78. How much of your next payment goes toward principal, and how much goes toward interest? Compare this with the principal and interest paid in the first month's payment ($551.00 toward principal and $450.00 toward interest in the first month). What is happening? The amount that goes toward interest is $ 94.81 (Round to the nearest cent.) The amount that goes toward the principal is $ 906.19 (Round to the nearest cent.) Over time, as the loan is paid, the principal becomes V of each payment has to cover interest and V of each payment can go toward so reducing the principal. smaller, larger,
Transcribed Image Text:Consider the following loan: a 60-month, $45,000 car loan with a 12% APR, compounded monthly. Assume that right after you make your 50th payment, the balance on the loan is $9,480.78. How much of your next payment goes toward principal, and how much goes toward interest? Compare this with the principal and interest paid in the first month's payment ($551.00 toward principal and $450.00 toward interest in the first month). What is happening? The amount that goes toward interest is $ 94.81 (Round to the nearest cent.) The amount that goes toward the principal is $ 906.19 (Round to the nearest cent.) Over time, as the loan is paid, the principal becomes V of each payment has to cover interest and V of each payment can go toward so reducing the principal. smaller, larger,
Consider the following loan: a 60-month, $45,000 car loan with a 12% APR, compounded monthly. Assume that right after you make your 50th payment, the balance on the loan is $9,480.78. How much of your next payment goes toward principal, and how much goes toward interest? Compare this with the principal and interest paid in the first month's payment ($551.00 toward principal and $450.00 toward interest in the first month). What is happening? ..... The amount that goes toward interest is $ 94.81 . (Round to the nearest cent.) The amount that goes toward the principal is $ 906.19 (Round to the nearest cent.) Over time, as the loan is paid, the principal becomes V of each payment has to cover interest and V of each payment can go toward so reducing the principal. less more
Transcribed Image Text:Consider the following loan: a 60-month, $45,000 car loan with a 12% APR, compounded monthly. Assume that right after you make your 50th payment, the balance on the loan is $9,480.78. How much of your next payment goes toward principal, and how much goes toward interest? Compare this with the principal and interest paid in the first month's payment ($551.00 toward principal and $450.00 toward interest in the first month). What is happening? ..... The amount that goes toward interest is $ 94.81 . (Round to the nearest cent.) The amount that goes toward the principal is $ 906.19 (Round to the nearest cent.) Over time, as the loan is paid, the principal becomes V of each payment has to cover interest and V of each payment can go toward so reducing the principal. less more
Expert Solution
trending now

Trending now

This is a popular solution!

steps

Step by step

Solved in 2 steps with 2 images

SEE SOLUTIONCheck out a sample Q&A here
Blurred answer
Similar questions
Recommended textbooks for you
EBK CONTEMPORARY FINANCIAL MANAGEMENT
EBK CONTEMPORARY FINANCIAL MANAGEMENT
Finance
ISBN:
9781337514835
Author:
MOYER
Publisher:
CENGAGE LEARNING - CONSIGNMENT
Intermediate Financial Management (MindTap Course…
Intermediate Financial Management (MindTap Course…
Finance
ISBN:
9781337395083
Author:
Eugene F. Brigham, Phillip R. Daves
Publisher:
Cengage Learning
Pfin (with Mindtap, 1 Term Printed Access Card) (…
Pfin (with Mindtap, 1 Term Printed Access Card) (…
Finance
ISBN:
9780357033609
Author:
Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk
Publisher:
Cengage Learning
CONCEPTS IN FED.TAX., 2020-W/ACCESS
CONCEPTS IN FED.TAX., 2020-W/ACCESS
Accounting
ISBN:
9780357110362
Author:
Murphy
Publisher:
CENGAGE L
Corporate Fin Focused Approach
Corporate Fin Focused Approach
Finance
ISBN:
9781285660516
Author:
EHRHARDT
Publisher:
Cengage
Principles of Accounting Volume 1
Principles of Accounting Volume 1
Accounting
ISBN:
9781947172685
Author:
OpenStax
Publisher:
OpenStax College
SEE MORE TEXTBOOKS