Question
In: Finance
(EXCEL HIGHLY REGARDED) Today, Malorie takes out a 10-year loan of $200,000, with a fixed interest...
(EXCEL HIGHLY REGARDED)
Today, Malorie takes out a 10-year loan of $200,000, with a fixed interest rate of 3.7% per annum compounding monthly for the first 3 years. Afterwards, the loan will revert to the market interest rate.
Malorie will make monthly repayments over the next 10 years, the first of which is exactly one month from today. The bank calculates her current monthly repayments assuming the fixed interest rate of 3.7% will stay the same over the coming 10 years.
(a) Calculate the size of the repayment that the bank
requires Malorie to make at the end of the first
month.
(b) Calculate the loan outstanding at the end of the fixed interest period (i.e. after 3 years).
(c) Calculate the total interest Malorie pays over this fixed interest period.
(d) After the fixed interest period, the market interest rate becomes 4.7% per annum effective. Assuming the interest rate stays at this new level for the remainder of the term of the loan, calculate the new monthly instalment.
Solutions
jeff jeffy answered 2 years agoRelated Solutions
Today, Malorie takes out a 10-year loan of $200,000, with a fixed interest rate of 5.7%...
Today, Malorie takes out a 10-year loan of $200,000, with a
fixed interest rate of 5.7% per annum compounding monthly for the
first 3 years. Afterwards, the loan will revert to the market
interest rate.
Malorie will make monthly repayments over the next 10 years, the
first of which is exactly one month from today. The bank calculates
her current monthly repayments assuming the fixed interest rate of
5.7% will stay the same over the coming 10 years.
(a) Calculate...
Today, Malorie takes out a 10-year loan of $200,000, with a fixed interest rate of 3.6%...
Today, Malorie takes out a 10-year loan of $200,000, with a
fixed interest rate of 3.6% per annum compounding monthly for the
first 3 years. Afterwards, the loan will revert to the market
interest rate.
Malorie will make monthly repayments over the next 10 years, the
first of which is exactly one month from today. The bank calculates
her current monthly repayments assuming the fixed interest rate of
3.6% will stay the same over the coming 10 years.
(a) Calculate...
Today, Malorie takes out a 10-year loan of $200,000, with a fixed interest rate of 3.6%...
Today, Malorie takes out a 10-year loan of $200,000, with a
fixed interest rate of 3.6% per annum compounding monthly for the
first 3 years. Afterwards, the loan will revert to the market
interest rate. Malorie will make monthly repayments over the next
10 years, the first of which is exactly one month from today. The
bank calculates her current monthly repayments assuming the fixed
interest rate of 3.6% will stay the same over the coming 10 years.
(a) Calculate...
Today, Malorie takes out a 30-year loan of $200,000, with a fixed interest rate of 4.5%...
Today, Malorie takes out a 30-year loan of $200,000, with a
fixed interest rate of 4.5% per annum compounding monthly for the
first 3 years. Afterwards, the loan will revert to the market
interest rate. Malorie will make monthly repayments over the next
30 years, the first of which is exactly one month from today. The
bank calculates her current monthly repayments assuming the fixed
interest rate of 4.5% will stay the same over the coming 30
years.
(c) Calculate...
Today, Malorie takes out a 20-year loan of $200,000, with a fixed interest rate of 4.5%...
Today, Malorie takes out a 20-year loan of $200,000, with a
fixed interest rate of 4.5% per annum compounding monthly for the
first 3 years. Afterwards, the loan will revert to the market
interest rate.
Malorie will make monthly repayments over the next 20 years, the
first of which is exactly one month from today. The bank calculates
her current monthly repayments assuming the fixed interest rate of
4.5% will stay the same over the coming 20 years.
(b) Calculate...
Today, Malorie takes out a 20-year loan of $200,000, with a fixed interest rate of 4.9%...
Today, Malorie takes out a 20-year loan of $200,000,
with a fixed interest rate of 4.9% per annum compounding monthly
for the first 3 years. Afterwards, the loan will revert to the
market interest rate.
Malorie will make monthly repayments over the next 20
years, the first of which is exactly one month from today. The bank
calculates her current monthly repayments assuming the fixed
interest rate of 4.9% will stay the same over the coming 20
years.
(c) Calculate...
Today, Malorie takes out a 20-year loan of $200,000, with a fixed interest rate of 3.2%...
Today, Malorie takes out a 20-year loan of $200,000, with a
fixed interest rate of 3.2% per annum compounding monthly for the
first 3 years. Afterwards, the loan will revert to the market
interest rate. Malorie will make monthly repayments over the next
20 years, the first of which is exactly one month from today. The
bank calculates her current monthly repayments assuming the fixed
interest rate of 3.2% will stay the same over the coming 20 years.
(a) Calculate...
Today, Malorie takes out a 20-year loan of $200,000, with a fixed interest rate of 4.9%...
Today, Malorie takes out a 20-year loan of $200,000,
with a fixed interest rate of 4.9% per annum compounding monthly
for the first 3 years. Afterwards, the loan will revert to the
market interest rate.
Malorie will make monthly repayments over the next 20
years, the first of which is exactly one month from today.
The bank calculates her current monthly repayments assuming the
fixed interest rate of 4.9% will stay the same over the coming 20
years.
(b) Calculate...
Today, Malorie takes out a 20-year loan of $200,000, with a fixed interest rate of 4.9%...
Today, Malorie takes out a 20-year loan of $200,000,
with a fixed interest rate of 4.9% per annum compounding monthly
for the first 3 years. Afterwards, the loan will revert to the
market interest rate.
Malorie will make monthly repayments over the next 20
years, the first of which is exactly one month from today. The bank
calculates her current monthly repayments assuming the fixed
interest rate of 4.9% will stay the same over the coming 20
years.
(d) After...
Today, Malorie takes out a 20-year loan of $200,000, with a fixed interest rate of 4.5%...
Today, Malorie takes out a 20-year loan of $200,000, with a
fixed interest rate of 4.5% per annum compounding monthly for the
first 3 years. Afterwards, the loan will revert to the market
interest rate. Malorie will make monthly repayments over the next
20 years, the first of which is exactly one month from today. The
bank calculates her current monthly repayments assuming the fixed
interest rate of 4.5% will stay the same over the coming 20
years.
(b) Calculate...
ADVERTISEMENT
ADVERTISEMENT
Latest Questions
- If one calculated a standard deviation of 18.38% for a security with an expected return of...
- The Declaration of Independence contends that "whenever any Form of Government becomes destructive" of individual life,...
- Where did Hip Hop originate? Who are some of the early innovators of Rap? What are...
- JAVA Remember the childhood game “Rock, Paper, Scissors”? It is a two-players game in which each...
- Assess potential global strategies for the organization. What are the four types of global strategies What...
- Consider the following abbreviated financial statements for Weston Enterprises: (Do not round intermediate calculations.) WESTON ENTERPRISES...
- Financing Deficit Stevens Textile Corporation's 2019 financial statements are shown below: Balance Sheet as of December...
ADVERTISEMENT