In the PMT function, what is not true about the rate argument? Group of answer choices It assumes an annual interest rate. It can contain references to fields. It is optional. It reflects the interest charged on a loan.

Q: Define the term Deferred Loan Repayments?

A: Answer: A deferred loan payment is nothing but a loan agreement in which the borrower may start…

Q: which of the following conditions indicates that a loan assumption is least advisable? An existing…

A: Loan Assumption In a simple term loan assumption which indicates that financial obligation which was…

Q: he difference between an ordinary annutty and an annulty due is: Multiple Choice an ordinary annuity…

A: Annuity means where regular payment is made at the end of regular period and full amount with…

Q: Differentiate between free and costly trade credit.What is the formula for determining the…

A: Answer: Free trade and costly trade credit: If trading is on credit, the suppliers of products often…

Q: It is an average interest rate that banks offer in the financial market: a. effective rate b.…

A: Effective Rate: It is the interest rate on a loan provided or financial security restated from the…

Q: Which one of the below most likely respresents the periodic receipts of interest? O the coupon rate.…

A: Periodic payments means fixed amount paid regularly to the investor. Example interest amount on…

Q: Which of the following is not a way in which banks lend short-term unsecured loans?     Through…

A: Banks offer and provide short term loans which are unsecured to borrowers. It has been explained in…

Q: When the total interest charged is linearly proportional to the initial amount of the loan, the…

A: Interest is an additional amount that is charged on deposited amount for a period. Interest is an…

Q: When using the interest tables, the needed interest rate is determined from the intersection between…

A: Interest rate tables show the values of present value/future value factors for $1 investment at a…

Q: Identify the types of information that can readily be deter-mined from an amortization table for an…

A: Meaning of amortization table Amortization table is a table which consists of all the details…

Q: A forward rate is a borrowing/lending rate for a loan to be made at some future date.   Select…

A:

Q: How can effective APR differ from nominal interest? A. Effective APR takes loan fees into account,…

A: Nominal interest rate is the stated interest rate on a loan. It is the interest rate which does not…

Q: Which of the following type of loan is best used for temporary shortfalls of income? a. Secured…

A: Loans can be short term loans or long term loans

Q: Which of the following statements regarding fixed-rate loans is true?   Group of answer choices a.…

A: Fixed rate loans are loans which have a fixed rate of interest.

Q: Which of the following is subject to change over the life of an adjustable-rate mortgage loan?…

A: An adjustable-rate mortgage is a mortgage where the interest rate applied on the outstanding balance…

Q: If you were taking out a loan and the interest rate was the same either way, would you want it to be…

A: Simple interest is the interest payable on principal or borrowed amount only. Compound interest is…

Q: hich of the following is not a way in which banks lend short-term unsecured loans? a. Through a…

A: Banks give short term credits to the business to increase the business and grow business and provide…

Q: Time Value of Moneyi Comparing Interest Rates Different compounding periods, are used for different…

A: The Nominal interest rate is the interest rate quoted by borrowers and lenders and it is also called…

Q: When financial institutions, such as banks or credit unions, advertise the rates on their loans,…

A: APR is the annual percentage rate. EAR is the effective annual rate. Banks, financial institutions…

Q: Which one of the theories states that “the rate of interest is set in the market for money…

A: Interest rates are fluctuated based on different parameters of the economy. There are different…

Q: When would there be a discount on a loan? How about a premium?

A: The loan is purchased to finance the purchase of equipment, education purposes, the purchase of…

Q: In practice, interest rates do not stay the same over time unless by contractual obligation. Select…

A: Interest rate is the percentage amount of interest which is due per period and is calculated as a…

Q: Why would lenders, in general, tend to set loan maturities (not amortization, but when the loan…

A: Loan Maturity: The time period for which a loan is extended is known as the loan period.  The date…

Q: Illustrate with examples , that Interest rate is equivalent to the savings rate from the deposits?

A: Interest received It is the amount that is received to a person for the investment made. A rate at…

Q: Which of the following statements is true about the present value factors? a. The present value…

A: Option c>> The present value factor is also known as the discount factor.  Is correct  Present…

Q: Repricing risk refers to:   Question 11 options:   Risk of a change to the maturity of a credit…

A: Repricing refers to any change in the interest rate because of change in maturity date or may be due…

Q: Which one is the contractual equation for buying an FRA? a.) Loan with maturity t2 plus Deposit with…

A: FRA (Forward Rate Agreement) refers to personalised financial contracts that are traded Over the…

Q: What is the expected result of a zero-interest-bearing note that is sold today for less than face…

A: Solution: Zero interest bearing note are note that contains no interest and same is issued at a…

Q: On what factors do the interest rate and repayment terms for term loans based?

A: Loan refers to the lending of money  by one ore more individuals  or organizations . The recipient…

Q: Interest prepaid by the​ buyer, which may be used to reduce the stated interest rate the lender​…

A: It is the fees paid directly to the lender at the closing in exchange for a reduced interest rate.

Q: An important application of -Select- loans. Each loan payment consists of interest and repayment of…

A: Loan amount = $11,000 Rate = 8% Time = 5 years

Q: If an installment loan is paid in full before the maturity date, the full amount of interest on the…

A: Loan is the amount which borrower takes from lender on a certain cost which is called as interest.

Q: which of the following is necessary to solve a discount problem?   a.future amount   b.interest…

A: In a discounting problem, the present value of future cash flow is calculated. In order to…

Q: The two main factors that determine the market interest rate on a loan or bond are: Length of time…

A: Market interest rate is the interest rate offered on a financial instrument in the financial market,…

Q: Write out an equation for the nominal interest rate on any debtsecurity.

A: Nominal Interest Rate: This rate is the rate that does not take into consideration the inflation…

Q: What are the forward rates of interest? How are they determined? What do they have to do with…

A: Forward rates of interest has basis as expectation of future interest rate that are implied in the…

Q: True or false. Rate of return is the interest earned on the unpaid balance of an amportized loan

A: Rate of return is calculated to ascertain the profit and loss of an investment. It is expressed in…

Q: clarely distinguish between nominal internest rate and effective interest rate

A: Nominal interest rate are simple interest rates that don't consider the effect of compounding.…

Q: This rate is included in the face of the note:     stated rate market rate effective interest yield…

A: Rate of the note determine the payment amount in form of interest to the holder. Interest payment is…

Q: If you were comparing the costs of loans from different lenders, could you use their APRs to…

A: Annual percentage returns (APR): It indicates the rate of interest on the loan of investment. In…

Q: Collateral security is used by the lender when interest is not paid on time the loan is not repaid…

A: Collateral is type of a security that the borrower gives to the lender as a security the loan taken.…

Mortgages

A mortgage is a formal agreement in which a bank or other financial institution lends cash at interest in return for assuming the title to the debtor's property, on the condition that the obligation is paid in full.

Mortgage

The term "mortgage" is a type of loan that a borrower takes to maintain his house or any form of assets and he agrees to return the amount in a particular period of time to the lender usually in a series of regular equally monthly, quarterly, or half-yearly payments.