Question
In: Finance
Amortization schedule with periodic payments. Moulton Motors is advertising the following deal on a used Honda...
Amortization schedule with periodic payments. Moulton Motors is advertising the following deal on a used Honda Accord: "Monthly payments of $238.11 for the next 54 months and this beauty can be yours!" The sticker price of the car is $9,500. If you bought the car, what interest rate would you be paying in both APR and EAR terms? What is the amortization schedule of the first six payments?
Solutions
Expert Solution
We are given the following information:
| Payment | PMT | 238.11 |
| APR | r | 14.00% |
| Number of years | n | 4.50 or 4.5 x 12 = 54 |
| Monthly | frequency | 12.00 |
| Loan amount | PV | 9500.00 |
We need to solve the following equation to arrive at the required APR
So the APR is 13.99%
Due to compounding effect the EAR will be greater than the APR:
Amortization schedule is as follows:
Opening balance = previous year's closing balance
Closing balance = Opening balance+Loan-Principal repayment
PMT is calculated as per the above formula
Interest = 0.139990817719448 /12 x opening balance
Principal repayment = PMT - Interest
jeff jeffy answered 1 year agoRelated Solutions
Amortization schedule with periodic payments. Moulton Motors is advertising the following deal on a used Honda...
Amortization schedule with periodic payments.
Moulton Motors is advertising the following deal on a used
Honda Accord: "Monthly payments of $233.92 for the next 48
months and this beauty can be yours!" The sticker price of the car
is $9,400. If you bought the car, what interest rate would you be
paying in both APR and EARterms? What is the amortization schedule
of the first six payments?
Amortization schedule with periodic payments. Moulton Motors is advertising the following deal on a used Honda...
Amortization schedule with periodic payments. Moulton Motors is
advertising the following deal on a used Honda Accord: "Monthly
payments of $165.73 for the next 60 months and this beauty can be
yours!" The sticker price of the car is $7,800. If you bought the
car, what interest rate would you be paying in both APR and EAR
terms? What is the amortization schedule of the first six
payments?
If you bought the car, what monthly interest rate would you...
Amortization schedule with periodic payments. Moulton Motors is advertising the following deal on a used Honda...
Amortization schedule with periodic payments. Moulton Motors is
advertising the following deal on a used Honda Accord: "Monthly
payments of $307.74 for the next 36 months and this beauty can be
yours!" The sticker price of the car is $9,400. If you bought the
car, what interest rate would you be paying in both APR and EAR
terms? What is the amortization schedule of the first six
payments?
Amortization schedule with periodic payments. Moulton Motors is advertising the following deal on a new Honda...
Amortization schedule with periodic payments. Moulton Motors is
advertising the following deal on a new Honda Civic: "Monthly
payments of $595.39 for the next 36 months and this beauty can be
yours!" The sticker price of the car is $19,000. If you bought the
car, what interest rate would you be paying in both APR and EAR
terms? What is the amortization schedule of the first six
payments?
Moulton motors is advertising the following deal on a new Honda civic: Monthly payments of $709.88...
Moulton motors is advertising the following deal on a
new Honda civic: Monthly payments of $709.88 for the next 36 months
and this beauty can be yours!" the sticker price of the car is
$22,000. if you bought the car, what interest rate would you be
paying in both APR and EAR terms? what is the amortization schedule
of the first six payments?
Loan Amortization Schedule You purchase a fully loaded Honda Accord with an MSRP of $32,000 for...
Loan Amortization Schedule
You purchase a fully loaded Honda Accord with an MSRP of $32,000
for $27,000. You pay the 3% tax of $810 up front and put down
$5,000. The dealer offers a simple interest installment loan with
an annual rate of 5% for 3 years. The projected resale value of the
car after 2 years is $17,000.
Compute the loan value and monthly loan payments. (10 pts)
Create a monthly amortization schedule over the entire loan
period. (10...
Refer to the following lease amortization schedule. The 10 payments are made annually starting with the...
Refer to the following lease amortization schedule. The 10
payments are made annually starting with the beginning of the
lease. Title does not transfer to the lessee and there is no
purchase option or guaranteed residual value. The asset has an
expected economic life of 12 years. The lease is
noncancelable.
Payment
Cash
Payment
Effective
Interest
Decrease
in balance
Outstanding Balance
69,952
1
10,000
10,000
59,952
2
10,000
5,396
4,604
55,348
3
10,000
4,981
5,019
50,330
4
10,000
4,530
5,470...
Refer to the following lease amortization schedule. The 10 payments are made annually starting with the...
Refer to the following lease amortization schedule. The 10
payments are made annually starting with the beginning of the
lease. Title does not transfer to the lessee and there is no
purchase option or guaranteed residual value. The asset has an
expected economic life of 12 years. The lease is
noncancelable.
Payment
Cash
Payment
Effective
Interest
Decrease
in balance
Outstanding Balance
101,385
1
15,000
15,000
86,385
2
15,000
8,639
6,361
80,024
3
15,000
8,002
6,998
73,026
4
15,000
7,303
7,697...
Amortization with Equal Payments. Prepare an amortization schedule for a three-year loan of $57,000. The interest...
Amortization with Equal Payments. Prepare an
amortization schedule for a three-year loan of $57,000. The
interest rate is 8 percent per year, and the loan calls for equal
annual payments. How much interest is paid in the third year? How
much total interest is paid over the life of the loan?
Problem 6-55 Amortization with Equal Payments [LO3] Prepare an amortization schedule for a five-year loan of...
Problem 6-55 Amortization with Equal Payments [LO3]
Prepare an amortization schedule for a five-year loan of
$61,000. The interest rate is 8 percent per year, and the loan
calls for equal annual payments. (Do not round intermediate
calculations and round your answers to 2 decimal places, e.g.,
32.16. Leave no cells blank - be certain to enter "0" wherever
required.)
Year
Beginning
Balance
Total
Payment
Interest
Payment
Principal
Payment
Ending
Balance
1
$
$
$
$
$
2
...
ADVERTISEMENT
ADVERTISEMENT
Latest Questions
- sara is a 50-year-old woman who lives in a poor village in india. unfortunately, sara’s health...
- What is your opinion on the use of AI technology? Is it necessary or is it...
- For this problem, carry at least four digits after the decimal in your calculations. Answers may...
- Why is it okay to speculate on Currency?
- What is the budgeting cycle and master budget? Why should companies use a master budget?
- please i need to have good answers and easy to understand This exercise refers to the...
- (1 point) Find y as a function of t if y′′+25y=0, y(0)=4,y′(0)=6. y= ?
ADVERTISEMENT