You want to buy a new sports coupe for $84,500, and the finance office at the dealership has quoted you an APR of 5.2 percent for a 60-month loan to buy the car. a. What will your monthly payments be? b. what is the effective annual rate of this loan

You want to buy a new sports coupe for $84,500, and the finance office at the dealership has quoted you an APR of 5.2 percent for a 60-month loan to buy the car. a. What will your monthly payments be? b. what is the effective annual rate of this loan

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter19: Lease And Intermediate-term Financing

Section: Chapter Questions

Problem 14P

See similar textbooks

Related questions

Q: Suppose you take out a 36-month installment loan to finance a delivery van for $26,100. The payments…

A: Loan pay-off: It means paying the remaining loan balance in just one payment.

Q: You need to borrow $12,000 to buy a car, so you visit two banks and are given two alternatives. The…

A: Loan is a contract between lender and borrower where lender provide funds to borrower which repaid…

Q: You want to buy a new sports coupe for $81,500, and the finance office at the dealership has quoted…

A: i= 0.0525 (6.3%/12) n = 60

Q: Suppose you lend $11,500 to a friend at an APR of 10.00%. Your friend will pay you back beginning…

A: The periodic payment can be made monthly, quarterly, semi-annually or annually. Periodic payment is…

Q: You want to buy a new sports coupe for $74400 and the finance office at the dealership has quoted…

A: given, p=$74400 r=6.8% m=12 n=4 years (4812)

Q: You want to buy a new sports coupe for $79,500, and the finance office at the dealership has quoted…

A: The car loan is a contract where car buyer is allowed to take delivery of car by making small…

Q: Suppose you take out a 36-month installment loan to finance a delivery van for $26,100. The payments…

A: Loan amount =26100 Financial charges =9360 Monthly payment =985 Total =36 months Monthly financial…

Q: After deciding to acquire a new car, you can either lease the car or purchase it with a three-year…

A: Lease is a way to get the asset for a fixed time period by paying periodicals payments to other…

Q: Suppose you take out a 36-month installment loan to finance a delivery van for $26,100. The payments…

A: Loan is amount borrowed by some investor or company from the stock market or taken by individual…

Q: You wish to buy a $10,000 dining room set. The furniture store offers you a three-year loan with an…

A: Given information: Present value or principal value is $10,000 Number of years of loan is 3 Interest…

Q: To finance the purchase of a new factory recently, you’ve arranged for a 40-year mortgage loan for…

A: Annual percentage rate (APR) refers to the annual cost of funds borrowed. The APR is usually…

Q: You want to buy a new sports coupe for $75,300, and the finance office at the dealership has quoted…

A: Loan amount (PV) = $ 75,300 Interest rate = 7.7% Monthly interest rate (r) = 7.7%/12 =…

Q: You are ready to buy a house. Total price is $160,105. For the remaining part, you plan to borrow…

Q: a. A consumer loan worth ₱75,000 is to be repaid in two years at 6% compounded monthly. What is the…

A: a) Loan (L) = P 75000 n = 2 years = 24 months r = 6% per annum = 0.5% per month Let A = Monthly…

Q: You want to buy a Ford SUV with a list price of $48,000. Dealer A offers to sell it for a discount…

A: PMT is the periodic payment.

Q: You need to borrow $80,000 to purchase a car. You qualify for a 7-year car loan that requires you to…

A: Borrowing = 80,000 Time Period = 7 years or 84 months Monthly Compounding Interest Rate = 2.28%/12 =…

Q: You are buying your first car for $20,000 and are paying $2,000 as a down payment. You have…

A: For determination of equal monthly payment(PMT), we need to use loan amortisation formula below. PMT…

Q: You are buying a $10,000 second hand car with a down-payment of $3,000 and you finance the remaining…

A: Solution:- When a loan is taken, generally equal periodic installments are paid inclusive of…

Q: Suppose you purchase a car for a total price of $22,565 including taxes and license fee, and finance…

A: A mortgage (or loan) with a fixed annual stated rate is the net amount of borrowings that a borrower…

Q: You have just purchased a new warehouse. To finance the purchase, you’ve arranged for a 30-year…

A: Annual Percentage Rate (APR) refers to the percentage rate which shows the interest rate…

Q: Suppose you get paid every two weeks. You determine that you can afford to divert $80 from each…

A: We will use the concept of time value of money here. As per the concept of time value of money the…

Q: You are buying your first car for $20,000 and are paying $2,000 as a down payment. You have…

A: the monthly loan amount will be = p*[ r(1+r)n/(1+r)n-1]…

Q: You want to buy a new sports coupe for $74,100, and the finance office at the dealership has quoted…

Q: You want to buy a new sports coupe for $74,900, and the finance office at the dealership has quoted…

A: Loan amount (PV) = $ 74,900 Annual interest rate = 7.3% Monthly interest rate (r) = 7.3%/12 =…

Q: You are going to buy new machinery worth$36,200. The dealer computes your monthly paymentto be…

A: The effective annual rate of interest is the actual or the real rate of interest paid or received…

Q: You want to buy a new sports coupe for $75,100, and the finance office at the dealership has quoted…

A: Loan Amount is $75,100 APR is 7.5% Total Number of months is 72 Monthly rate is 7.5%12=0.625% To…

Q: Suppose you purchase a car for a total price of $24,790 including taxes and licensee and finance…

A: To find the monthly payment, we will use the present value of annuity formula and adjust it to find…

Q: You decide to buy a car for $16,000.00 and decide to make payments of $700 each month. If the loan…

A: The present value of the annuity is the current worth of a cash flow series at a certain rate of…

Q: A new furniture set costs $ 2700. If you make a down payment of $ 300 and finance the rest at a rate…

A: The amount of repayment is the number of installments multiply by the installment amount. and the…

Q: how much must he put down? (Round your answer to the nearest cent.)

A: Loan amortization refers to a schedule which is prepared to shows the periodic loan payments, amount…

Q: You want to borrow $115,000 from your local bank to buy a new sailboat. You can afford to make…

A: Annual Percentage Rate is the annual rate of interest charged from borrowers for the payment to…

Q: You have saved RM 4,000 for a down payment on a new car. The largest monthly payment you can afford…

A: Given: Given:

Q: Suppose you take out a 36-month installment loan to finance a delivery van for $26,100. The payments…

A: some borrowers who take installment loan wishes sometimes to prepay installments, so they are…

Q: You have saved $4,000 for a down payment on a new car. Thelargest monthly payment you can afford is…

A: Given information: Down payment $4,000 Monthly payment of $350 APR is 12% Number of months 48 and 60

Q: How much downpayment should you put at the time of purchase? how would i calculate this in excel?

A: Downpayment: It refers to the amount of money paid by the buyer in the early phase of purchasing…

Q: You want to buy a car and therefore you borrowed $10,000 from a bank today for 6 years. The nominal…

A: It can be calculated using PMT function in excel. PMT(rate, nper, pv, [fv], [type]) Rate The…

Q: Suppose you are in the market for a new car worth $18,000. You are offered a deal to make a $1,800…

A: Loan amortization schedule refers to the presentation of complete loan payments over the period of…

Q: Suppose that you decide to purchase a new car. You go to a credit union to get preapproval for your…

A: According to the time value of money concept, the value of the amount of money in the future is less…

Q: You want to buy a new sports coupe for $84,500, and the finance office at the dealership has quoted…

A: Given information : Price of car : $84,500 APR : 4.7% Time period : 60 months

Q: You want to buy a new sports coupe for $87,500, and the finance office at the dealership has quoted…

A: As per the given information: Present value (P) - $87,500 APR - 6.9% Monthly APR (I) - 6.9%/12 =…

Q: Suppose you take out a 36-month installment loan to finance a delivery van for $26,100. The payments…

A: Loan payoff will be the closing balance at the end of 25 months

Q: If you are financing a new car with a loan that requires 15% interest compounded monthly over a 4…

A: Present value of annuity concept is required to use in this case. Present value of annuity is the…

Q: You are in the process of getting a new car but are not sure if you should buy or lease. The total…

A: A lease refers to a contract where one party gives another party the right to use property or…

Q: You want to buy a new sports coupe for $78,500, and the finance office at the dealership has quoted…

A: Loan amount = $78,500 Annual percentage rate (APR) = 6% Effective annual rate (EAR) is the…

Question

You want to buy a new sports coupe for $84,500, and the finance office at the dealership has quoted you an APR of 5.2 percent for a 60-month loan to buy the car.

a.	What will your monthly payments be?

b. what is the effective annual rate of this loan

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1

Step 2

Step 3

Step 4

Step 5

Step 6

Step 7

Step 8

Step 9

Trending now

This is a popular solution!

Step by step

Solved in 9 steps with 4 images

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

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
You want to buy a new sports coupe for $74,700 , and the finance office at the dealership has quoted you a loan with an APR of 7.1 percent for 72 months to buy the car what will be monthly payments what is the effective annual rate
You want to buy a new sports coupe for $74400 and the finance office at the dealership has quoted you a loan with an APR of 6.8 percent for 48 months to buy the car. a.What will your monthly payments be? b. What is the effective annual rate of this loan?
You want to buy a new sports coupe for $75,300, and the finance office at the dealership has quoted you a loan with an APR of 7.7 percent for 36 months to buy the car. a. What will your monthly payments be? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) b. What is the effective annual rate on this loan? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)
You want to buy a new sports coupe for $78,500, and the finance office at the dealership has quoted you an APR of 6 percent for a 60 month loan to buy the car. a. What will your monthly payments be? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) b. What is the effective annual rate on this loan? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)
Calculating Loan Payments You want to buy a new sports coupe for $69,300, and the finance office at the dealership has quoted you a loan with an APR of 5.6 percent for 48 months to buy the car. What will your monthly payments be? What is the effective annual rate on this loan?
You want to buy a new sports coupe for $75,200, and the finance office at the dealership has quoted you a loan with an APR of 7.6 percent for 48 months to buy the car. What will your monthly payments be? Note: Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16. What is the effective annual rate on this loan? Note: Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.