Personal Finance, Student Value Edition Plus MyLab Finance with Pearson eText -- Access Card Package (6th Edition)
6th Edition
ISBN: 9780134426839
Author: Jeff Madura
Publisher: PEARSON
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Chapter 1, Problem 6FPP
Summary Introduction
To discuss: The option person J have and how will these options affect his net worth and cash flow.
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Wrett purchases a new four-wheeler with a loan from his bank. The bank requires that he use his car, which is paid off, as collateral for the loan he secured from the bank. The value of the 4-wheeler is $2500.00. The value of the car is $15,000.00. Wrett defaults on his loan for the 4-wheeler and thus is forced to sell his car to repay the loan. Which statement below is true regarding this secured transaction?
Multiple Choice
Since the value of the car far exceeds the value of the 4-wheeler, the bank must accept an alternate good closer to value of the 4-wheeler.
Wrett must dispose of his car and apply the proceeds to the loan and if there is any surplus the money belongs to Wrett.
The bank will sell the car for the value of the loan of the 4-wheeler, not the actual fair market value of the car.
Wrett must hand over physical possession and title to the car.
In a workout, creditors are usually paid in all of the following ways except,
Multiple Choice
Bankruptcy…
Susan and Jose rent an apartment and have been saving for a house. They now have $10,000 in the bank. Susan owes $4,000 on a low-interest credit card; Jose owes $4,500 on his car. Susan wants to pay the credit card and car off to eliminate the debt. Jose wants to keep the cash in the bank and continue saving for the house. What are the pros and cons of each one’s argument? Please be detailed and concise. Feel free to use a chart or table to represent your argument.
Kayla Gordan plans to borrow $300,000 from ANZ bank to set up a Nail Salon.She currently has $10,000 in savings and she will use her house as security for the loan.Which of the following best represents a risk associated with this financing method?
A.Kayla's proportion of business ownership will be diluted
B.Interest payments are tax deductible
C.Bank will repossess her house if she defaults on the loan
D.Kayla is required to pay dividends to the bank
Chapter 1 Solutions
Personal Finance, Student Value Edition Plus MyLab Finance with Pearson eText -- Access Card Package (6th Edition)
Ch. 1 - Prob. 1RQCh. 1 - Prob. 2RQCh. 1 - Prob. 3RQCh. 1 - Prob. 4RQCh. 1 - Prob. 5RQCh. 1 - Prob. 6RQCh. 1 - Prob. 7RQCh. 1 - Prob. 8RQCh. 1 - Prob. 9RQCh. 1 - Prob. 10RQ
Ch. 1 - Prob. 11RQCh. 1 - Prob. 12RQCh. 1 - Prob. 13RQCh. 1 - Prob. 14RQCh. 1 - Prob. 15RQCh. 1 - Prob. 16RQCh. 1 - Prob. 17RQCh. 1 - Prob. 18RQCh. 1 - Prob. 19RQCh. 1 - Prob. 20RQCh. 1 - Prob. 21RQCh. 1 - Prob. 22RQCh. 1 - Prob. 23RQCh. 1 - Prob. 24RQCh. 1 - Prob. 25RQCh. 1 - Prob. 1FPPCh. 1 - Prob. 2FPPCh. 1 - Prob. 3FPPCh. 1 - Prob. 4FPPCh. 1 - Prob. 5FPPCh. 1 - Prob. 6FPPCh. 1 - Prob. 7FPPCh. 1 - Prob. 1FPOE
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