Answered: Solve the given problem about loan.…

Solve the given problem about loan. Show your solution. 1. A smart phone was bought at an amortized loan of Php20,000 with 18% annual interest to be paid in 5 months. Find the monthly amortization.

Pfin (with Mindtap, 1 Term Printed Access Card) (mindtap Course List)

7th Edition

ISBN:9780357033609

Author:Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk

Publisher:Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk

Chapter7: Using Consumer Loans

Section: Chapter Questions

Problem 7FPE: Calculating interest and APR of installment loan. Assuming that interest is the only finance charge,...

See similar textbooks

Related questions

Q: What statutory protection is offered to a third party who enters into a contract with a person…

A: A third party who enters into a contract with a person purporting to act on behalf of a company…

Q: Formulate but do not solve the problem. Kelly Fisher invested a total of $20,000 in two municipal…

A: Bonds are debt instruments that carry a fixed rate of interest. The interest is the income earned…

Q: Maxine Peru, the CEO of Peru Resources, hardly noticed the plate of savory quenelles de brochet and…

A: Net Present Value (NPV) analysis: Initial investment: $10 million (possible cost overruns 10-15%)…

Q: Consider the three stocks in the following table. Pt represents price at time t, and Qt represents…

A: In a market value-weighted index, companies with larger market caps are given a higher weight in the…

Q: What is the amount to be recorded as a Non- Current Lease Liability in the books of Rib Ltd that is…

A: The annual lease is being paid at the beginning of every year. The lease given is $180,000 that…

Q: The ratio of current assets and current liabilities at BHP is equal to 3. Suppose current assets and…

A: The current ratio is a financial ratio that is used to determine the financial position of a…

Q: Debt service funds are used to account for which of the following? Multiple Choice Payment of…

A: Debt service funds are the records of resources of funds for payment of interests and principal…

Q: 4.StockA sells for $40 a share. Its likely dividend payout and end-of-year price depend on the state…

Q: Suppose that today you start a savings account with a deposit of $75, and continue to invest $75 at…

A: Future value The value of a current asset at some point in the future, based on an estimated growth…

Q: How much federal tax will a single person who earns $435,000 pay? $126,794 $47,843 $225,575 $209,425

A: Taxable income is income on which tax is determined and levied on the basis of the tax rate. This…

Q: You purchased a share of stock for $120. One year later, you received $1.82 as a dividend and sold…

A: Holding period return (HPR) is the return that is earned on the asset by holding it over a period of…

Q: An insurance company sells an annuity that provides 20 annual payments, with the first payment…

A: The formula for the initial payment of a growing annuity is given as follows. First Payment =Present…

Q: You will receive a cash payment of $7072 in 7 years. If the relevant interest rate is 19.89%, how…

A: Time Value of Money states that a dollar earned today is more valuable than any time in the future,…

Q: Vespa Motors makes a partial payment of $8,726 on an invoice of $17,680.38. If the invoice is dated…

A: In the first partial payment made the discount of 4% is applicable. The portion of the amount paid…

Q: QUESTION 1 A long-lost relative recently created a trust fund for you in her will. Per the terms of…

A: Here are two questions on the board. In the first case, we need to value a deferred perpetuity. In…

Q: s a financial analyst, you have been tasked with evaluating Randy Watson Music's free cash flow.…

A: Operating capital is the amount of money needed to be invested in equipment, working capital and…

Q: On December 3, 2019 a sum of $36,700.00 was deposited into an account. What would be the future…

A: Present value is a current value, which means that if a company or individual receives money today,…

Q: The existence of a bank is argued by her transformation functions. One typical bank product is a…

A: Banks and financial institutions are pillars of the financial system. They are intermediaries that…

Q: Suppose that the interest rate is 4%. What is the value of the discount factor, v? υ Enter a value…

A: An interest rate is given. We have to find the value of the discount factor and the discount rate.…

Q: Linda can borrow or save money at an interest rate of 10%. Consider a simple two period model in…

A: (a) Linda's budget line is given by the equation: C1 + (1 + 0.1)C2 = 20000 + (1 + 0.1)(20000 -…

Q: You are offered the chance to participate in a project that produces the following cash flows: C0…

A: Net present value of the project is calculated as Net present value = C0 + C11+k1+C21+k2

Q: Payback IRR PI NPV NP-30 years. NX-20 years %

A: Please refer to the excel spreadsheet for answers. Consider the first cell in the spreadsheet to be…

Q: A bank issues two mortgages M1 and M2 for $1 million each. Both mortgages mature at the end of the…

A: To calculate the market value of the senior and junior tranches, we first need to calculate the cash…

Q: With a goal of purchasing one of the coveted trips to space offered by Pharoah, you deposit $53,000…

A: Present value is an estimate of the expected monetary value of future cash flows. Investors evaluate…

Q: Thanks alot I just want to know from where you got the (inventory = 95) Thanks

A: Current assets are those assets which can be easily converted into cash without any problem during…

Q: The interest rate on a GIC is 3.45% compounded semi-annually. What is the purchase price of the GIC…

A: Present value The amount of cash that must be invested in order to realize a given future objective…

Q: Mr. Husker’s Tuxedos Corp. began the year 2021 with $280 million in retained earnings. The firm…

A: The retained earning of the company is the total earning which is retained over the years and it is…

Q: Sam is thinking about taking out a loan. The interest rate is 9.50 % p.a. and is calculated daily.…

A: The effective annual interest rate is generally representative of the rate of interest after…

Q: Lebleu, Incorporated, is considering a project that will result in initial aftertax cash savings of…

A: Initial cost refers to the cost that the company pays at the beginning of the project. The…

Q: Find the amount necessary to fund the given withdrawals. Semiannual withdrawals of $550 for 4 years;…

A: Present value refers to the money present today being more valuable than the amount that will…

Q: Fritz Benjamin buys a car costing $17900. He agrees to make payments at the end of each monthly…

A: The loan amount refers to the money that is borrowed by the borrower from the lender in against of…

Q: discuss the relationship between the percentage of a bonds price due to its coupon payments and the…

A: Bonds are debt security that enables borrowers to raise funds from investors to fulfill their…

Q: a-1. What is the NPV of each project if the discount rate is 10%? (Do not round intermediate…

A: NPV is the discounted value of future cash inflows. NPV is calculated by discounting the cash…

Q: If the treasury management section of the bank is attempting to minimise interest rate risk, how…

A: In order to minimize the risk, the treasury management must match the duration. It must calculate…

Q: Suppose you have an account that will grow to $381,000.00 in 15 years. It grows at 3% annual…

A: The annuity refers to a payment series that provides the holder with a periodic payment in exchange…

Q: a) You purchase 516 shares of ABC Co. stock on margin at a price of $37. Your broker requires you to…

A: STEP 1 MARGIN CALL A margin call is a notification from the brokerage business that the amount of…

Q: Atreides International has operations in Arrakis. The balance sheet for this division in Arrakeen…

A: The depiction of one currency in terms of another country's currency is regarded as the forex rate…

Q: This question is about futures risk premia. Consider a two period economy.You can buy stocks in…

A: The expected return on this trading strategy would be equal to the risk-free rate, as the investment…

Q: 2. (Immunization of FI) Consider a financial institution whose asset and liability both consist of…

A: (a) Market Value of Asset: The market value of the asset can be calculated as follows: PV = Face…

Q: If you deposit$5,000in a 5 -year certificate of deposit earning2.0%per year, how much will it be…

A: This question provides information regarding the evaluation of an investment of $5,000 into a five…

Q: 4. Asymmetric information a) means that investors may be subject to adverse selection b) means that…

A: Asymmetric information will mean there will be lack of transparency in the market and one party will…

Q: 4. Which of the below represents the value of an American option in each state? max(Payoff if…

A: Call option gives the right but not the obligation to buy at the strike price. While put option…

Q: We expect a perpetuity of quarterly cash flows of $80,000 starting in 1 quarter. Given a discount…

Q: a. Suppose you believe Nice's initial revenue growth rate will be between 10% and 20% (with growth…

A: In order to calculate the sensitivity of the share price relative to the initial growth rate, we…

Q: Suppose you have an account that will grow to $253,000.00 in 25 years. It grows at 7.5% annual…

A: Future value is the value of future cash flow at a certain period after applying a discount rate,…

Q: deal on the FX spot market and one

A: Foex trading is selling and purchase of currencies between the client or may be through banks or may…

Q: Rachael initially borrowed $6,800 from RBC Bank at 4.7% compounded monthly. After 4 years she repaid…

A: A loan is an agreement between two parties where one party forwards an amount to the other one in…

Q: A stock is priced at $50 with a volatility of 35 percent. A call option with an exercise price of…

A: The Black-Scholes-Merton (BSM) model is used to calculate the theoretical price of a European call…

Q: Use the information below to answer the following questions. Currency per U.S. $ 1.2380 1.2353…

A: STEP 1 The risk-free rate is the interest a potential investor may get over a certain time period…

Concept explainers

Amortized Loans

The term "amortization" refers to spreading the value of a loan or a debt over a series of regular payments or installments comprising of both the principal and interest amount. It generally involves the process where in the value of a loan or an intangible asset is written down over its maturity period.

Question

C. Solve the given problem about loan. Show your solution.
1. A smart phone was bought at an amortized loan of Php20,000 with 18% annual interest to be paid in 5 months. Find the monthly amortization.

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

VIEW

Step 2

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, finance and related others by exploring similar questions and additional content below.

Similar questions

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)?
Calculating interest and APR of installment loan. Assuming that interest is the only finance charge, how much interest would be paid on a 5,000 installment loan to be repaid in 36 monthly installments of 166.10? What is the APR on this loan?
Suppose you borrowed Php 30,000 on a student loan at a rate of 8% and must repay it in three (3) equal installments at the end of each of the next three (3) years. a )How much would you pay every year? b) How much of the first payment would represent interest? c) How much would be the principal? d) What would your ending balance be after the first year? e) Complete the loan amortization table.
The purchase price of a car is Php 40,141, Mr. Smith makes a down payment of Php 5,802 and borrows the balance from a bank at 0.25 compounded monthly for 11 years. Calculate the value of the required monthly payments to pay off the loan. Will upvote, Thankyou :)
Answer the Situation below correctly show your complete solution. A loan of 30 000.00 Php is to be paid monthly for 5 years that will start at the end of 4 years . If converted monthly at 12 % , how much is the monthly payment ?a . The type of annuity illustrated in the problem is _________________.b. The total number of payments is ______.c . The number of conversion period in the period deferral is ___________________.d. The interest rate per period is _________.e . The present value of the loan is_______.
Answer the Situation below correctly show your complete solution. A loan of 30 000.00 Php is to be paid monthly for 5 years that will start at the end of 4 years . If converted monthly at 12 % , how much is the monthly payment ?a . The type of annuity illustrated in the problem is _________________.b. The total number of payments is ______.c . The number of conversion period in the period deferral is ___________________.d. The interest rate per period is _________.e . The present value of the loan is_______. (I just need the Solution) Answers: a. Deferred Annuity; b. 60; c. 47; d. 0.01; e. 30 000.00 Php
You get a twenty-year amortized loan of Php100,000 with a 5% annual interest rate. What are the annual payments? a. Php 8,718 B. Php37,689 C. Php 4,762 d.Php 8,024
The purchase price of a car is Php 35,051, Mr. Smith makes a down payment of Php 2,311 and borrows the balance from a bank at 0.3 compounded quarterly for 21 years. Calculate the value of the required quarterly payments to pay off the loan. Will upvote, thankyou so much :)
Answer the Situation below correctly show your complete solution. A loan of 30 000.00 Php is to be paid monthly for 5 years that will start at the end of 4 years . If converted monthly at 12 % , how much is the monthly payment ?c . The number of conversion period in the period deferral is ___________________.d. The interest rate per period is _________.e . The present value of the loan is_______. (I just need the Solution) Answers: c. 47; d. 0.01; e. 30 000.00 Php
For numbers 1 to 3, calculate the simple interest earned. Round to the nearest centavo.1. P = Php 2,500.00, r = 6%, t = 1 year2. P = Php 9,000.00, r = 5.6%, t = 6 months3. P = Php 22,000.00, r = 7.2 %, t = 120 days4. The simple interest charged on a 60 – day loan of Php 8,400.00 is Php 119. Find the simple interest rate.5. If Php 12,000.00 is deposited for 5 years in an account that earns 9%, calculate the simple interest earned
Answer the following question correctly refer to the given problem below and show your Complete Solution (Given, Required, Equation, Solution, Answer). Mr. Quiton loans an amount of Php 30,000.00 which is to be paid monthly for 5 years that will start at the end of 4 years , if converted monthly at 12%, how much is the monthly payment ? 1. What is the type of annuity illustrated in the given problem? A. Simple Annuity B. General Annuity C. Deferred Annuity D. Complex Annuity 2. Compute for the interest rate per period. A. 0.01 B. 0.05 C. 0.10 D. 0.12 3. Determine the present value of the loan. A. Php 12,000.00 B. Php 30,000.00 C. Php 60,000.00 D. Php 75,000.00
Answer the Situation below correctly show your complete solution.I already provided the answer I just need the SOLUTION.( Annuities )A loan of 30 000.00 Php is to be paid monthly for 5 years that will start at the end of 4 years . If converted monthly at 12 % , how much is the monthly payment ?a . The type of annuity illustrated in the problem is _________________.b. The total number of payments is ______.c . The number of conversion period in the period deferral is ___________________.d. The interest rate per period is _________.e . The present value of the loan is_______. Answers: a. Deferred Annuity; b. 60; c. 47; d. 0.01; e. 30 000.00 Php