Question
In: Finance
EREREFEFE--- Suppose you apply a 5-year bank loan of $500000 at 12% APR, repayable in equal...
EREREFEFE---
Suppose you apply a 5-year bank loan of $500000 at 12% APR, repayable in equal installments at the end of each month.
a. How much do you need to pay each month?
b.How much is owed (to the bank) at the end of year 3?
c. How much interest is paid at the first month of year 4 of the loan
Solutions
jeff jeffy answered 1 year agoRelated Solutions
Suppose you apply a 5-year bank loan of $500000 at 12% APR, repayable in equal installments...
Suppose you apply a 5-year bank loan of $500000 at 12% APR,
repayable in equal installments at the end of each month.
a. How much do you need to pay each month?
(Round up your answer to the nearest two decimal points)
b.How much is owed (to the bank) at the end of year 3?
(Round up your answer to the nearest two decimal points)
c. How much interest is paid at the first month of year 4 of the...
Suppose you apply a 5-year bank loan of $500000 at 12% APR, repayable in equal installments...
Suppose you apply a 5-year bank loan of $500000 at 12% APR,
repayable in equal installments at the end of each month.
a. How much do you need to pay each month?
b.How much is owed (to the bank) at the end of year 3?
c. How much interest is paid at the first month of year 4 of the
loan? d. How much interest is paid over the last two years of the
loan? (Round up your answer to...
Suppose you apply a 5-year bank loan of $500000 at 12% APR, repayable in equal installments...
Suppose you apply a 5-year bank loan of $500000 at 12% APR,
repayable in equal installments at the end of each month. a. How
much do you need to pay each month? b.How much is owed (to the
bank) at the end of year 3? c. How much interest is paid at the
first month of year 4 of the loan? d. How much interest is paid
over the last two years of the loan?
Suppose you apply a 5-year bank loan of $500000 at 12% APR, repayable in equal installments...
Suppose you apply a 5-year bank loan of $500000 at 12% APR,
repayable in equal installments at the end of each month.
a. How much do you need to pay each month?
b.How much is owed (to the bank) at the end of year 3?
c. How much interest is paid at the first month of year 4 of the
loan?
d. How much interest is paid over the last two years of the
loan? (Round up your answer to...
You borrowed $10,000 two years ago. The loan terms are: 5-year loan with APR of 12%...
You borrowed $10,000 two years ago. The loan terms are: 5-year
loan with APR of 12% and with monthly payments of $222.44. Today,
you decided you want to pay off the loan in 20 months rather than
the remaining life of the loan. How much more do you have to add to
your monthly payment in order to accomplish it?
Write out your answer in the space provided. MAKE SURE TO
SHOW HOW YOU OBTAIN THE ANSWER (STEPS NECESSARY). If...
You borrowed $10,000 two years ago. The loan terms are: 5-year loan with APR of 25%...
You borrowed $10,000 two years ago. The loan terms are: 5-year
loan with APR of 25% compounded monthly.
1. What is the monthly payment for the loan?
2. What is the loan balance today?
3. Today, you decide to pay off the loan in 20 months rather
than the remaining life of the loan. How much more do you have to
add to your monthly payment in order to accomplish the goal?
Please include Excel formulas.
Suppose you need a 5-year mortgage loan to purchase a house that worth $450,000. The bank...
Suppose you need a 5-year mortgage loan to purchase a house that
worth $450,000. The bank offers two interest rate options for you
to choose:
(i). Fixed rate at 3.5%. Interest rate will remain fixed for
that loan's entire term, no matter how the market interest rate
changes.
(ii). Variable rate which varies with market interest rate and
is typical 1.5% above the market interest rate.
Which one would you choose? Briefly explain
why.
Consider a loan of 75,000 repayable by equal quarterly instalments over 15 years calculated at an...
Consider a loan of 75,000 repayable by equal quarterly
instalments over 15 years calculated at an interest rate of 8.80%
per annum convertible quarterly. From the lenders perspective, set
a cash flow model in tabular form which covers all the scheduled
repayments in the 15 years, allowing for tax at 30% on the interest
component of the loan. Calculate the amount of each quarterly
payment and calculate the after tax internal rate of return
achieved by the lender on its...
Blair has a 5-year personal loan with the bank. He currently makes an equal quarterly repayment...
Blair has a 5-year personal loan with the bank. He currently
makes an equal quarterly repayment at the end of each quarter at an
interest rate of 7% p.a. compounded quarterly. Which of the
following may reduce the total cost of the loan? (There may be more
than one correct answer. You will lose marks by choosing a wrong
answer. The minimum mark for the question is zero.)
Select one or more:
a. To renegotiate the interest rate to 7%...
5. QRS Bank is charging a 12 percent interest rate on a $5,000,000 loan. The bank...
5. QRS Bank is charging a 12 percent interest rate on a
$5,000,000 loan. The bank also charged $100,000 in fees to
originate the loan. The bank has a cost of funds of 8 percent. The
borrower has a five percent chance of default, and if default
occurs, the bank expects to recover 90 percent of the principal and
interest. What is the risk of the loan using the Moody's Analytics
model? Briefly discuss.
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