John borrowed $84,000 at 9.60% compounded monthly. He agreed to repay the loan in equal monthly...

John borrowed $84,000 at 9.60% compounded monthly. He agreed to repay the loan in equal monthly payments over a 15 year amortization term. (a) What is the size of the monthly payment?t Enter answer to 2 decimal places

b) Now assume that in part (a) you had rounded the payments DOWN to the nearest dollar, what would be the size of the final payment? Round down to nearest dollar means for example 121.8 is rounded to $121.00 (NOT 122)

c) Re-do this problem by going back to the first step in part (a) without making any rounding of the payments. Assume 4 years has gone by and after the 480 payment, the loan term is reset, with the banks new rate becoming 8.2% with semi-annual compounding. The borrower also pays down an extra S4000 at this time. What would be the new monthly payments?

Solutions

Expert Solution

The answers are as follows:

jeff jeffy answered 1 year ago

Next > < Previous

Related Solutions

Mr. Lamb borrowed $85,000 at 11.40% compounded monthly. He agreed to repay the loan in equal...

Mr. Lamb borrowed $85,000 at 11.40% compounded monthly. He agreed to repay the loan in equal monthly payments over 15 years. What is the size of the monthly payment rounded up to nearest cent? How much of the 24th payment is interest? How much of the 137th payment goes towards principal? How much principal was paid down in the third year? Now assume that in part (a) you had rounded the payments down to the nearest dollar, what would be...

The owner of a hotel borrowed $13 000 at 7.8% compounded semi-annually and agreed to repay...

The owner of a hotel borrowed $13 000 at 7.8% compounded semi-annually and agreed to repay the loan by making payments of $750 at the end of every 4 months. How much payments will be needed to repay the loan? How much will be owed at the end of 5 years? By the end of 5 years of payments, what is the total interest payed? A contract valued at $28 000 requires payments of $6500 every 6 months. The first...

You have borrowed 15,000 and agreed to repay the loan with 5 annual level payments of...

You have borrowed 15,000 and agreed to repay the loan with 5 annual level payments of 4000, with the ﬁrst payment occurring one year from today. What annual interest rate are you paying?

If you borrowed $30,000 at 25% annual interest. You agreed to repay the loan with five...

If you borrowed $30,000 at 25% annual interest. You agreed to repay the loan with five equal annual payments. How much of the total amount repaid is interest? How much of the third annual payment is interest, and how much principal is there? If you decided to pay off your loan after the third payment, how much will you pay? please i want the result step by step by hand not using excel! thanks in advance

If you borrowed 24000 at 6% annual interest. You agreed to repay the loan with five...

If you borrowed 24000 at 6% annual interest. You agreed to repay the loan with five equal annual payments. How much of the total amount repaid is interest? How much of the third annual payment is interest, and how much principal is there? If you decided to pay off your loan after the third payment, how much will you pay?

You have borrowed $39,168 at 2.41%pa compounded monthly with monthly repayments. You decide to repay $632...

You have borrowed $39,168 at 2.41%pa compounded monthly with monthly repayments. You decide to repay $632 per month. How long (in years)will it take you to repay the loan? Please give your answer in years, correct to 2 decimal places

You have just borrowed $300,000 to buy a condo. You will repay the loan in equal...

You have just borrowed $300,000 to buy a condo. You will repay the loan in equal monthly payments of $3,950.37 over the next 20 years. a-1. What monthly interest rate are you paying on the loan? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.) a-2. What is the APR? (Do not round intermediate calculations. Enter your answer as a whole percent.) b. What is the effective annual rate on that loan? (Do...

You have just borrowed $160,000 to buy a condo. You will repay the loan in equal...

You have just borrowed $160,000 to buy a condo. You will repay the loan in equal monthly payments of $1,287.40 over the next 30 years. a-1. What monthly interest rate are you paying on the loan? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.) a-2. What is the APR? (Do not round intermediate calculations. Enter your answer as a whole percent.) b. What is the effective annual rate on that loan? (Do...

You have just borrowed $100,000 to buy a condo. You will repay the loan in equal...

You have just borrowed $100,000 to buy a condo. You will repay the loan in equal monthly payments of $804.62 over the next 30 years. a. What monthly interest rate are you paying on the loan?' b. What is the APR? c. What is the effective annual rate on that loan? d. What rate is the lender more likely to quote on the loan?

You have just borrowed $200,000 to buy a condo. You will repay the loan in equal...

You have just borrowed $200,000 to buy a condo. You will repay the loan in equal monthly payments of $2,106.45 over the next 25 years. a-1. What monthly interest rate are you paying on the loan? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.) Monthly interest rate % a-2. What is the APR? (Do not round intermediate calculations. Enter your answer as a whole percent.) APR% b. What is the effective annual...

Subjects