Q: Answer the following questions correctly. a. The interest is computed on the principal and on the…
A: Note: I am suppose to provide solution of first question.Please repost the remaining questions…
Q: Finding the total interest of a loan is similar to finding the total interest in an annuity's
A: When you take a loan then you have to make payments towards the principal amount as well as towards…
Q: Describe the repayment process for both a term loan and ab
A: Term loan and bonds are two different types of raising money.
Q: Explain in general terms how the portions of loan payments going to principal and interest change…
A: Installment loans gradually pay down the loan principal while the payments remain the same .…
Q: how are the origination fees borne by the borrower accounted for in relation to the initial…
A: External financing is the outsourcing of funds and refers to investment or financing provided by…
Q: nterest is a method of calculating the interest to be paid on a loan by combining the principal…
A: Add on interest refers to the method which is used when the person acquire the loan or the mortgage…
Q: The payment for the use of borrowed money is called: loan maturity value interest principal
A: Borrowed money is the loan taken, which is to be repaid within the terms of the loan contract.
Q: A forward rate is a borrowing/lending rate for a loan to be made at some future date. Select…
A:
Q: What is the difference between a line of credit and a short-term loan?
A: Short term loan: A loan is borrowed money that is to be paid back along with the interest. 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: Interest expense
A: Interest expense paid on a loan which has prescribed is deductible from gross income of the payor…
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: Notes receivable should be stated at amortized cost which is equivalent to its present value which…
A: The Amortised cost is the present value of cash inflows from note receivable using an effective…
Q: A loan with compound interest always cost more than a loan with simple interest. True or false
A: Simple interest is the simplest form of calculation of interest in which interest is calculated on…
Q: As a loan is paid off, the monthly payment increases debt and interest portions do not change each…
A: Interest expenses on loan is calculated on the closing balance of the loan account on a particular…
Q: Determine whether the following statement is true or false, and explain why. A loan is amortized if…
A: Borrowing by an individual or a corporation is the method through which the individual and the…
Q: Which equation would not work to find the fixed rate of simple interest on his loan? a) r= Pt b) / =…
A: Simple Interest is considered one of the easiest and simplest methods of calculating interest. Under…
Q: What is defined as the interest on a load or principal that is based only on the original amount of…
A: The right answer is option (D) simple interest
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: There is a formula that will find the APR, i, of a single payment loan but not for a series of…
A: The term “annual percentage rate (APR)” refers to the annual rate of interest charged to borrowers…
Q: The actual amount that is given to the borrower is called the after the loan has been discounted.
A: Basically a discounted loan has three components Discount Proceeds Maturity Value
Q: Required Correct Option 1- The amount which borrower has to pay to lender for taking and using his…
A: Issuing the financial instruments will increase the capital , as well as the capital of the company.…
Q: What is the indifference point under the net present value? When would there be a discount on a…
A: SOLUTION- NET PRESENT VALUE = PRESENT VALUE OF CASH INFLOW - PRESENT VALUE OF CASH OUTFLOW.
Q: It is the fractional part of the capital or sum invested that is paid for the loan or investment.…
A: 1. The rate of interest is some predecided percentage that is charged on the loan amount or provided…
Q: What are three components used by a lender in determining the interestrate charged for a loan?
A: The three components used by a lender in determining the interest rate charged for a loan are as…
Q: The discount rate used in a net present value analysis is the ________. A. rate of interest…
A: Net present value is calculated by the deducting the present value of cash outflows from the present…
Q: 11. In an amortization problem, the outstanding principal at the beginning of the term is the…
A: Laon amortization schedule means where repayment during the life of loan is written with interest.…
Q: Which of the following is true when the mortgage loan is an amortizing loan? a. At the beginning of…
A: Borrowings are the liability of the company which is used to finance the requirement of the funds.…
Q: Explain how an installment loan differs from revolving credit in terms of risk and the nature of the…
A: Installment credit is a type of loan in which the borrower receives a defined, or limited, sum of…
Q: ents plus the interest on the remaining loan. What was the amount of the loan? What was the amount…
A: in this problem payment is made by four equal payment plus interest on remaining amount.
Q: ne loans which are to be repaid within a short O a. Fixed liabilities b. Long-term liabilities C.…
A: Ans. Liabilities can be of many types - i. Current Liabilities ii. Non-current Liabilities iii.…
Q: The two major components of the interest rate that cause rates to vary across different investment…
A: Maturity risk premium: Maturity risk premium is considering as the amount of additional return you…
Q: If a person charges interest on a loan transaction equivalent to the inflation rate than will it be…
A: Time value of the money is the value of the money which a person must use in order to know how much…
Q: The borrowing base used to guarantee collateral on an operating line of credit is highly dependent…
A: Borrowing base means the maximum amount that a borrower can borrow from a lender. Any excess of…
Q: REATE AN EXAMPLE PROBLEM WITH CASHFLOW a.) nominal compound interest b.) continuous compound…
A: Solution Example of nominal compound interest Calculate the future value of $12345 deposited today…
Q: Which one of the following is a spontaneous source of financing? Select the correct response:…
A: Spontaneous source of financing is the short term financing needed for business transactions which…
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: 1. According to PFRS 9, The amortized cost of a financial instrument is calculated using. A. The…
A: We’ll answer the first question since the exact one wasn’t specified. Please submit a new question…
Q: In the PMT function, what is not true about the rate argument? Group of answer choices It assumes an…
A: Rate argument in PMT function is required and not optional and it assumes annual interest rate and…
Q: 1. In the most loan amortization schedules, amortization of discount or premium of the loan…
A: We’ll answer the first question since the exact one wasn’t specified. Please submit a new question…
Q: In the amortization of loans, interest must be paid at the beginning of each period calculated on…
A: Loans are amortized or paid off by way of scheduled and periodic regular payments. The payment…
Q: The original amount of money in a loan transaction is known as what?
A: Introduction: A loan is nothing but an amount of money lent from one or more individuals or…
Q: interest expense, which of the following * ?occurs firs Incurring The Interest Expense C Paying The…
A: Accrued interest expense implies interest expense that has been incurred but not yet paid. It is a…
1. True or false.
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- What is a compensating balance? What effect does a compensatingbalance requirement have on the effective interest rate on a loan?Which of the following type of loan is best used for temporary shortfalls of income? a. Secured loans b. Long Term Loan c. Line of Credit d. Short-Term LoanDescribe the concept of non interest bearing on loan.
- Add-on Interest is a method of calculating the interest to be paid on a loan by combining the principal amount borrowed and the total interest due into a single figure, then multiplying that figure by the number of periods for repayment. Is it True or False?The original amount of money in a loan transaction is known as what?1. Explain how an installment loan differs from revolving credit in terms of risk and the nature of the return to the lender.
- The payment for the use of borrowed money is called: loan maturity value interest principalIf a person charges interest on a loan transaction equivalent to the inflation rate than will it be still called Riba? How would then the issue of time value of money be resolved?Explain in general terms how the portions of loan payments going to principal and interest change over the life of the loan
- Define the term Deferred Loan Repayments?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.Which of the following loan types has a beginning loan balance equal to the ending loan balance? Group of answer choices Interest-only Partially amortizing Negative amortizing Fully amortizing Equal amortizing