Please show the formula being use 6.) Liza is planning to buy a Mazda 3 which has a price of 2.4million in cash.However, she wants to buy it installment for 5 years with 40 equal payments.If the interest rate is 8%, how much will she need to pay every payment?ANSWER: A = 201,264.38767.) John borrowed P4500 cash from his friend. His friend's condition is that hemust pay his debt in 2 years with an interest of 3% one time payment only.However, john plans to set aside an amount of money in his piggy bank every3months with an interest of 4% compounded quarterly until he canaccumulate the total debt and pay it one time to his friend. How much moneymust John set aside every 3months? ANSWER: A = 559.3995

Loan Payment: These represent periodic payments made to the lender by the borrower to amortize the…

Answered: years with 40 equal payme every…

Business

Finance

years with 40 equal payme every payment? how much will she need to pay

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter19: Capital Investment

Section: Chapter Questions

Problem 8E

See similar textbooks

Related questions

Q: A person try to buy an apartment five years from now , assuming that the first deposit was ( $ 3000…

A: Accumulated value after 5 years = 3000*(1+i)^4 + 3300*(1+i)^3 + 3600*(1+i)^2 + 3900*(1+i)^1 + 4200…

Q: shadow banking and how does it differ from traditional retail banking? What kind of threat does…

A: Shadow Banking: Shadow banking refers to bank-like activities that occur outside of the formal or…

Q: b. Percentage Change is calculated with the formula (30th June 2021 Value/30th June 2020 Value) - 1…

A: Solution:- Percentage change means the rate of change in values. Now, as per given information,…

Q: critically discuss the advantages and disadvantages of rights issue.

A: Right issues is raising money from existing shareholders by providing more equity to existing…

Q: Contracting company plans to update its equipment so that its trucks are replaced after five years…

A: Here we will use the concept of time value of money. As per the concept of time value of money the…

Q: D. Consider risky assets A & B where E (RA) = 20% a portfolio of 2 rish A = 10% CAB = 0.4 E (RB) =…

A: A minimum variance portfolio is a portfolio that will have such weights which minimise the variance…

Q: a) You buy a mining site, including exploration rights and there are set up costs of £285m…

A: “Hi There, Thanks for posting the questions. As per our Q&A guidelines, must be answered only…

Q: Lace Company provided the following information during the current year: 500,000 Dividend received…

A: A cash flow statement is a part of a financial statement. It helps to reconcile the opening cash…

Q: OUR MIS 2021: “Investec is a distinctive bank and wealth manager, driven by commitment to our core…

A: Things have changed over the time and hence mission statements of the financial because the…

Q: Joshua is saving up to buy a house. He invested $10000 at 3.5% per year, compounded quarterly. He…

A: Future Value: The future value is the amount that will be received at the end of a certain period.…

Q: The forecast for Discomfort’s free cash flows for next year is provided in the table. Assume that…

A: Here, Last Year Next Year Sales…

Q: Various types of budgets facilitate understanding about the big picture of a business. There are…

A: Budget A budget is the estimate of incomes and expenses over a specified period. A budget helps in…

Q: Company GoodHouse Inc. currently focuses on real estate business. As the CEO you plan to develop the…

A: Yield is a change in the price of an asset, investment, or project over time and can be expressed as…

Q: (Inflation and interest rates) What would you expect the nominal rate of interest to be if the…

A: The nominal rate of interest is the rate that includes the inflation effect in the interest rate.…

Q: ompany sells 280,000 units annually, at a price of (65 $/unit). The company ated to explore the…

A: The profit of the company is sales minus variable cost and fixed cost and labor cost. To increase…

Q: Alice has been in a defined-contribution pension scheme since she was 35 and will retire in one…

A: Pension plans are the plans in which the employer or the person who sponsor promises to pay a…

Q: 1.A research institution has just published projected inflation rates for the United States and…

A: The interest rate parity is a no-arbitrage situation where the future exchange rate between the…

Q: You have a certain investment with the shown cash flow diagram. The investment rate is 15% and the…

A: To Find: Value of X

Q: A family wants to purchase a house that costs $135,000. They plan to take out a $125,000 mortgage on…

A: Data given: Monthly payment for 15 year mortgage= $718.77 Monthly payment for 30 year mortgage= $…

Q: A manufacturing company is trying to decide between the two machines shown below. Determine which…

A: Equivalent Annual Cost: It is the yearly cost incurred for buying and keeping a resource. It is…

Q: A certain college graduate borrows 7406 dollars to buy a car. The lender charges interest at an…

A: Continuously compounded interest rate refers to the interest rate that is calculated on the…

Q: XPTO SA is an industrial all-equity financed company, and its shares have a beta of 1,6. The…

A: (Note: Since we only answer up to 3 sub-parts, we’ll answer the first 3. Please resubmit the…

Q: If you can earn 13% percent on similar-risk investments, what is the most you would be willing to…

A: We will use the dividend discount model here. As per the dividend discount model the intrinsic value…

Q: If the compounding frequency is monthly and the discount factor=0.62026, what is the value of the…

A: Let i(12) denote monthly interest rate Discount Factor = 1/(1+i(12)) 0.62026 = 1/(1+i(12)) i(12) =…

Q: Ruth bought an insurance for 66,000 at 6% to receive an annuity for 16 years. Find the specified…

A: A stream of equal cash flows (CF) paid or received periodically is termed as annuity. Annuity is…

Q: What is the effective interest rate p.a. on an overdraft facility where the bank requires 3.5%…

A: Value of bank overdraft=Utilization rate×Maximum limit=70%×NOK 500,000=NOK 350,000

Q: b) Link Bank is deciding whether to grant a loan application to a new customer. As part of the…

Q: Mr Price, has no debt outstanding and a total market value of R150,000. Earnings before interest and…

A: The Earnings per Share is calculated by dividing Earnings available to equity shareholders by number…

Q: A stock is expected to return 9% in a normal economy, 14% if the economy booms, and lose 4% if the…

A: Expected rate of return is the profit or loss on the investor that is assumed to be anticipated by…

Q: GSM Inc. STOCK RETURN YEAR PRICE Jan-2021 P57.70 Feb-2021 P52.90 Mar-2021 P50.95 Apr-2021 P58.25…

A: Here, Total Return =? Average Return =? Standard Deviation =?

Q: ry is expected to have a useful life of 5 years with no salvage value. Depreciation is by the…

A: Capital budgeting is the process by which a corporation examines potential large projects or…

Q: Mr Price, has no debt outstanding and a total market value of R150,000. Earnings before interest and…

A: Earnings per share(EPS) refers to an indicator or a financial ratio that shows how much a company is…

Q: w's Mites, Jesus explains to his disciples that the small sacrifices of the poor mean more to God…

A: The future value of money grow with time and interest rate and compounding of interest and will be…

Q: 3. For payments shown in the following table, and assuming the interest rate (10%), what is the five…

A: Present value is the discounted value of money considering the interest rate and time of annual…

Q: Financing Cash Flow 415 1,809…

A: Every business goes through three main phases – start up, mature, declinimg. Starup is the first…

Q: Jason invests $6000 in a savings account. The savings account pays compound interest at a rate of…

A: In case of compound interest, future value can be calculated as: = Initial Investment * ((1 + rate1)…

Q: Here are alphas and betas for Company X and Company Y for the 60 months ending April 2019. Alpha is…

A: (Note: We’ll answer the first question since the exact one wasn’t specified. Please submit a new…

Q: A firm with a below industry net profit margin can improve its return on total assets by: a.…

A: Net profit margin: Net profit margin evaluates how much net profit a firm makes per dollar of…

Q: Bennett Company has a potential new project that is expected to generate annual revenues of $206.600…

A: Annual Operating Cash Flow: It is a measure of how much cash generated by a company's typical…

Q: Given the following correlation matrix, a risk-averse investor would most likely prefer which of the…

A: Risk averse investor is the one who prefers to avoid loss from the investment. Therefore, these type…

Q: you have concluded that the following relationships are possible next year: economic status…

A: The expected return is calculated by multiplying the return and with the probability. Standard…

Q: purpo Badgeting 3. Keeping track of all income and expenses is very important to achieving your…

A: Financial objectives plays a vital role in the economy , As if we maintain our finances then we will…

Q: Rayleene is getting a loan to buy a used car from a seller. The price of the car is $8200.00. She…

A: As per our guidelines, we are supposed to answer only 3 sub-parts (if there are multiple sub-parts…

Q: A) compute the current price of Bond A

A: Market value of a bond is the present value of all future cash flows that comes from a bond. The…

Q: Suppose a young couple deposits $900 at the end of each quarter in an account that earns 7.6%,…

A: This question is an application of annuity. The future value of an annuity with equal periodic…

Q: hat are the 7 key factors that are common to all investors, briefly describe each

A: Each investor is different from the other investor in terms of risk appetite, investment horizon,…

Q: The company cost of capital, when the firm has both debt and equity financing, is called the:…

A: Answer- WACC is the weighted average of a company's debt and its equity cost. The weighted average…

Q: In 2000, an investment was opened with an initial deposit of $1800. The investment had grown to…

A: Future value of present amount With present value (P), annual compounded interest rate (i) and…

Q: 4 Alan planned to invest $8500 in a term deposit. He had two investment plans from which to choose.…

A: Since we only answer up to 3 sub-parts, we’ll answer the first 3. Please resubmit the question and…

Q: What is the difference between between beta and standard deviatio

A: In the world of finance in general and investing in particular we often use the concepts of beta as…

Question

Please show the formula being use

6.) Liza is planning to buy a Mazda 3 which has a price of 2.4million in cash.
However, she wants to buy it installment for 5 years with 40 equal payments.
If the interest rate is 8%, how much will she need to pay every payment?
ANSWER: A = 201,264.3876
7.) John borrowed P4500 cash from his friend. His friend's condition is that he
must pay his debt in 2 years with an interest of 3% one time payment only.
However, john plans to set aside an amount of money in his piggy bank every
3months with an interest of 4% compounded quarterly until he can
accumulate the total debt and pay it one time to his friend. How much money
must John set aside every 3months? ANSWER: A = 559.3995

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 3

VIEW

Step by step

Solved in 3 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

Liza is planning to buy aMazda 3 which has a price of 2.4million in cash. However, she wants to buy it installment for 5 years with 40 equal payments . If the interest rate is 8%, how much will she need to pay every payment?ANSWER: A = ₱201,264.3876
Patricia finances a $49,100 car with annual payments at a 3.10% interest rate over 8 years, at which time the car will have zero value. If she wants to sell the car in 2 years, how much does she need to sell the car for to break even? a.$6,955 b.$42,145 c.$5,655 d.$51,838 e.$37,925
1. If money is worth 5% compounded quarterly, how much must Julea save every end of three months to have P24,000 at the end of 7 years? 2. Josh wants to buy a car worth P250,000. He can pay the P100,000 down payment and the balance payable every end of the month for 5 years. Find how much must he pay monthly at 4% compounded monthly? 3. A loan of P8,500 is to be discharged with 15 equal quarterly payments. What is the quarterly payment, if the interest rate is 8% compounded quarterly
2. Andy is planning to buy a car when he graduates from college 4 years from now. The estimated valueof the car is $25000. He will need to make a down-payment equal to 20% of the value of the car. Heplans to raise the down-payment by making equal monthly deposits into a bank savings account thatpays interest at the rate of 6% per year, so that he has the down-payment, four years from now. Hewants you to help him Ögure out the minimum monthly deposit he will have to make for the next 4years.(a) What is the monthly interest rate the bank pays?(b) At this moment you do not know the value of the monthly deposit he has to make. Let it be Pdollars per month. Write down an expression for the total value of all the monthly payments hewill deposit, (including interest), over the 4 year period.(c) The expression in part (b) should equal the down-payment he will need for the down-payment.Use that information to determine P . Show the work leading to your answer. Round o§ youranswer to the nearest…
Michael wants to buy some new exercise equipment for his home gym for $123,000 financed at an annual interest rate of 11% using the add-on method. If Michael pays off the loan in 2 years, he will pay $27,060 in interest. If Michael decides instead to pay off the loan in 3 years, how much more interest will he pay than if he paid off the loan in 2 years? He will pay $___more in interest if he paid off the loan in 3 years.
Manuel and Aponi want to buy a $221,000 home. They plan to pay 20% as a down payment, and take out a 30 year loan at 3.85% interest for the balance.a) How much is the loan amount going to be?b) What will the monthly payment be for Manuel and Aponi?c) How much of the first payment is interest?d) What is the total of the payments?e) How much interest was paid?
Ken wants to remodel his basement and he wants to pay back no more than $18,000. If he gets a low interest loan at 3.75% compounded semi - annually and plans to repay the loan in one payment in 3 years, how much can he borrow? Show all workings.
Jino sold his house. In addition to cash, he took a mortgage on the house. The mortgage will be paid off by monthly payments of P12, 345 for 10 years. He decided to sell the mortgage to a local bank. The bank will buy the mortgage, but requires a 1% per month interest rate on their investment. How much will the bank pay for the mortgage?
Your sister bought a condominium unit for P9 300 000 through a condominium loan which she availed of from a universal bank at a fixed annual rate of 8% for 10 years.A. What amount is financed by the bank if she is required to pay an equity of 30% of the total price of the condominium?B. How much would be your sister’s monthly amortization if she is required to pay an equity of 30% of the total price of the condominium?
The MacEacherns wish to buy a new house that costs $279,000. The bank charges 5.25% interest. A) If the MacEacherns take out a 20-year mortgage, what will their monthly payment be? B) How much total interest will the MacEacherns pay if they only paid the minimum monthly payment found int part A and paid for the entire 20 years? C) If the home insurance premium for the year will be $1,224 and they will need to pay an annual property tax amount of $2,136, what is the PITI? D) What is the finance charge for the first payment? E) How much of the first monthly payment will go toward the balance/principal? F) What is the new balance on the loan?
Janet's parents want her to go to the same college that they did. They decided to pay a lump sum payment today of $135000 so she will be able to make 4 years of monthly withdrawals. The college provide an annuity of 6%, compounded monthly. If Janet will make her first withdrawal in 8 years, what is the size of each withdrawal? The answer is NOT $5,134.38 I'm asking this question again because the answer was WRONG!! please try to give me the right answer.
4. Rodel decided to sell their farm and to deposit the fund in a bank. After computing the interest, they learned that they may withdraw P480,000.00 arly for 8 years starting at the end of 6 years when it is time for him to retire. How much is the fund deposited if the interest rate is 5% converted annually?