Suppsoe that you borrow $14,000 for five years at 7% toward the purchase of a car. Use PMT to find the monthly payments and the total interest for the loan. (Round to the nearest cent as needed)

Q: Yesterday, John bought a ten-year, $50,000 coupon bond with an annual rate of 5% compounded…

A: Solution:- Market rate of return on bond means the rate of return required by the investors in…

Q: Harper Corporation has the following information about the purchase of a new piece of equipment:…

A: Gross profit is $50,000 per year Cost of equipment is  $130,000 Salvage value at the end of the 8 th…

Q: Blue Ram Brewing Company currently has no debt in its capital structure, but it is considering using…

A: CASE D/Cap Ratio  E/Cap Ratio D/E Ratio Bond Rating Before-Tax Cost of Debt (rdrd) Levered Beta (b)…

Q: Find the amount at the end of 4 years and 5 months if P7,000 is invested at 23% compounded…

A: Future Value refers to the value of the current asset or investment or of cash flows at a specified…

Q: A wealthy donor has given $400,000 to a university and specifies that it is to be used to give…

A: Here, Present value (P0)= $400,000 Interest rate (r) = 0.055 Number of years (N) = 25 years No. of…

Q: compute: 1. The minimum required return by Cross-Ocean’s debtholders  2. The minimum required return…

A: Minimum Required Return: It is the minimum return expected by an investor for investing in the…

Q: any is considering the purchase of a new machine. The price of the new machine is $122,000, freight…

A: Cash pay back period is number of years required to recover the initial amount of investment in the…

Q: reatment plant is to be constructed in Washington County. The initial installation will cost $40…

A: Capitalised cost = All Costs incidental to asset + Present value of future cost which is incurred in…

Q: Suppose Federal National Mortgage Association sells mortgage-backed securities (MBS) backed by a…

A: Here,

Q: The Seattle Corporation has been presented with an investment opportunity that will yield end of…

A: Cost of capital = 13% Year Cash flow 0 -135000 1 30000 2 35000 3 35000 4 45000 5…

Q: alculate the present value o mediate of 100 per quarter ng a nominalinterest ra mpounded monthly.

A: Present value is the value today of annuity that will be equivalent today to future cash flow from…

Q: 2. A public school teacher receiving a monthly salary of P26,494 with mandatory annual deductions of…

A: Annual Gross salary is the annual salary of an individual before any mandatory deductions are made.

Q: How long will it take for PhP 20,690 to accumulate to PhP 24,774 if money is worth 8% compounded…

A: Present value (PV) = Php 20,690 Accumulated amount (FV) = Php 24,774 Quarterly period = n Interest…

Q: Cullumber Company is considering a long-term investment project called ZIP. ZIP will require an…

A: Net Present value is present value of cash flow minus initial investment

Q: On May 6, May Payment makes a purchase of $258.50 on her credit card. The purchase appears on her…

A: A credit card is a pay later facility where banks pay on behalf of customers at the time of purchase…

Q: The following information are available for Showan Inc: Operating Profit Margin 21%, taxes of 35%,…

A: Operating profit margin ratio = 21% Tax rate = 35% Interest expenses = 120,000 Sales = 3,527,000…

Q: The following information relates to the acquisition of M plc by D plc: Recent dividend of M plc:…

A: When a company buys most of the shares of another company, it is called acquisition. Acquisition…

Q: Alphabet Inc., formerly Google Inc. recently had a market cap of $531.40 billion, total equity of…

A: Market Cap of Alphabet Inc. is $531.40 billion Total equiy is of $127.88 billion Total number of…

Q: STATE: Which of the following statements regarding homeowner's irsurance is true A. The listing…

A: Homeowner's insurance policy is the insurance policy for your home. It generally covers any…

Q: Which of the following statements is correct? The NPV method assumes that cash flows will be…

A: Solution:- Net Present Value (NPV) means the net of the present value of cash inflows and initial…

Q: What is the maximum amount you should pay today for an investment that pays a single future cash…

A: Future cash flow (FV) = $25000 Interest rate = 2% Semi annual interest rate (r) = 2%/2 = 1% Period =…

Q: An investor makes a single deposit of 10,000 into fund A for 10 years which earns a 6% effective…

A: Here,

Q: JPS plc's current share price is £3.63. An investor is wondering whether to buy shares in JPS or…

A: A warrant on a stock gives the holder the right but not the obligation to buy and sell the…

Q: Liza Ammorante borrow  125,000 per annum to be paid in 5 years time, on equal yearly at 6.735% per…

A: An amortized mortgage is a loan that is paid off in equal periodic installments. The installments…

Q: Identify three financial signs that are considered red flags. Briefly describe in one sentence for…

A: A red flag is a warning or a threat that tells the company that there is a potential threat to the…

Q: 1. Assume that on January 1, 2020 Aldous invested Php 100,000 in a financing company. Aldous would…

A: As per Bartleby guidelines, If multiple questions are posted , only first 1 question will be…

Q: Please describe the Compound Option, the advantages and disadvantages of investing in this option…

A: Options are referred as the financial derivatives, which provides the right to the purchaser, but…

Q: Suppose you had just gone long (purchased) on lot of Syarikat XYZ stock at a price of RM 15.00 each,…

A: Current Stock price is RM 15.00 Cost of 3-months put option us RM0.15 Put option is ATM(at the…

Q: Wendell’s Donut Shoppe is investigating the purchase of a new $18,600 donut-making machine. The new…

A: The cost of machine is $18,600 Annual cost savings $3800

Q: My question is for a synthetic call option why do we need to borrow the present value of the strike…

A: Synthetic calls and synthetic puts are the two types of synthetic options available. Both forms of…

Q: Consider the case of Scorecard Corporation: Scorecard Corporation is considering the purchase of…

A: Given: Purchase price $11,250 Years 4 Loan $11,250 Interest rate 3.60% Annual maintenance…

Q: calculate the value of the Treasury note:

A: Bond: It represents a debt instrument issued to raise capital for the business. The issuer pays…

Q: I. Find the value (using Binomial Tree) of a European style call option on an underlying stock which…

A: Options are derivatives. The value of option is derived from the value of an underlying asset.…

Q: A municipal bond with a face value of $10,000 and bond interest rate of 8% per year payable…

A: Given,  The face value of the bond is $10,000 Interest rate 8% Yield is 12%

Q: nator of the increment or of Diluted EPS is?

A: DEPS= Earnings availble for Equity shareholders + Savings in earnings or interest due to conversion…

Q: mortgage for a house is $289,275 and the monthly mortgage payment is $1801.39 for 30 years.…

A: Loans are paid by the monthly payments these carry the payment of principal amount and interest…

Q: a. Calculate the yield to maturity for a bond with a maturity of (i) one year; (ii) two years; (iii)…

A: YTM (Yield To Maturity): It is the total expected rate of return for a bondholder when all the…

Q: You are given the following information concerning three portfolios, the market portfolio, and the…

A: Risk and return are two parts of investment. There is a positive relation between the risk and…

Q: If prices increase at a monthly rate of 1.5%, by what percentage do they increase in a year?

A: Solution:- Percentage increase in price means net increase in price after effect of all the…

Q: Chris Sandvig Irrigation, Inc., has summarized the price list from four potential suppliers of an…

A: The ideal order ize for a company is called economic order quantity. It minimizes order cost and…

Q: how to create a projected cash flow for pastry shop

A: Cash flow is referred as the net amount of the cash & cash equivalents, which used to transfer…

Q: compounded monthly to have that amount when it is due? What is the interest rate per period? | M…

A: Present Value: It represents the present worth of the future amount and is estimated by discounting…

Q: Use the NPV method to determine whether Juda Products should invest in the following projects: •…

A: Answer 1:- The net present value (NPV) of a project is calculated as present value of cash inflows…

Q: Case A B C D E Amount of Annuity $2,500 500 30,000 11,500 6,000 Interest Rate 8% 12 20 9 14 Deposit…

A: Ordinary annuity is the annuity in which regular payment has been made at the end of each period…

Q: 4. IBM stock is currently trading at $100 per share. An investor purchases one Call option contract…

A: A call option provides the holder the right but not the obligation, to buy a certain security at a…

Q: Suppose you had just gone long (purchased) on lot of Syarikat XYZ stock at a price of RM 15.00 each,…

A: Concept.  Hedging long stock position. For buyer ( long position), there is profit if there is…

Q: g factory has been offered a contract to produce a part for a new printer. The contract would last…

A: Solution:- Internal Rate of Return (IRR) means the rate of return the project is yielding. At IRR,…

Q: Years to matunty Par value of bond Coupon rate Frequency interest paid per year Effective annual…

A: Here, To Find: Periodic rate =? Price of bond =?

Q: What is the difference between a credit card and a debit card? O A credit card is loaned money, plus…

A: Debit card or debit card are the facilities given by the banks to their customers so that they can…

Q: A company purchases a new asset for $400,000. It has a useful life of 8 years with a $80,000 salvage…

A: Explanation : Net Present value ( NPV) is that technique under capital budgeting which help for…

Cost of Credit

The cost of credit is an extra amount that the borrower has to pay besides the loan amount. These credit charges may vary from loan to loan. The cost of credit includes interest charges, maintenance charges, and arrangement charges. Some of the costs are mandatorily collected by the lender based on the loan amount and tenure of the loan. The cost of credit is also called finance charges of the credit.