You want to buy a $130,000 home. You plan to pay 5% as a down payment, and take out a 30 year loan at 4.65% interest for the rest. The bank will charge 1.5 points on the amount financed. a) What is the amount of the down payment? b) How much is the loan amount going b be? c) What will be the amount charged for 1.5 points? 1 point is 1 % of the mortgage amount [2. ) Find the amount of the monthly payment. (Do not add the cost of the points to the loan amount) int: click here

You want to buy a $130,000 home. You plan to pay 5% as a down payment, and take out a 30 year loan at 4.65% interest for the rest. The bank will charge 1.5 points on the amount financed. a) What is the amount of the down payment? b) How much is the loan amount going b be? c) What will be the amount charged for 1.5 points? 1 point is 1 % of the mortgage amount [2. ) Find the amount of the monthly payment. (Do not add the cost of the points to the loan amount) int: click here

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter11: Capital Budgeting Decisions

Section: Chapter Questions

Problem 8EB: You put $600 in the bank for 3 years at 15%. A. If Interest Is added at the end of the year, how...

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Use the tables in Appendix B to answer the following questions. A. If you would like to accumulate $2,500 over the next 4 years when the interest rate is 15%, how much do you need to deposit in the account? B. If you place $6,200 in a savings account, how much will you have at the end of 7 years with a 12% interest rate? C. You invest $8,000 per year for 10 years at 12% interest, how much will you have at the end of 10 years? D. You win the lottery and can either receive $750,000 as a lump sum or $50,000 per year for 20 years. Assuming you can earn 8% interest, which do you recommend and why?
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Del Hawley, owner of Hawleys Hardware, is negotiating with First City Bank for a 1-year loan of 50,000. First City has offered Hawley the alternatives listed here. Calculate the effective annual interest rate for each alternative. Which alternative has the lowest effective annual interest rate? a. A 12% annual rate on a simple interest loan, with no compensating balance required and interest due at the end of the year b. A 9% annual rate on a simple interest loan, with a 20% compensating balance required and interest due at the end of the year c. An 8.75% annual rate on a discounted loan, with a 15% compensating balance d. Interest figured as 8% of the 50,000 amount, payable at the end of the year, but with the loan amount repayable in monthly installments during the year
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You put $250 in the bank for S years at 12%. A. If interest is added at the end of the year, how much will you have in the bank after one year? Calculate the amount you will have in the bank at the end of year two and continue to calculate all the way to the end of the fifth year. B. Use the future value of $1 table in Appendix B and verity that your answer is correct.
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