This topic contains a solution. Click here to go to the answer
« previous next »

Author Question: If you borrow 5,000 at an annual interest rate of 9.0 for six years, what will your repayment(s) be ... (Read 69 times)

sdfghj

  • Hero Member
  • *****
  • Posts: 552
on: Jul 10, 2018
If you borrow 5,000 at an annual interest rate of 9.0 for six years, what will your repayment(s) be if this is an interest-only loan?
 
  What will be an ideal response?

Question 2

Assume a five-year equal payment amortization schedule with an annual interest rate of 12 and annual payments. If the beginning principal is 8,000, then the first interest payment will be how large?
 
  A) 960.00
  B) 1,200.00
  C) 2,219.28
  D) There is not enough information to answer this question.


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
Marked as best answer by a Subject Expert

jackie

  • Sr. Member
  • ****
  • Posts: 324
Reply #1 on: Jul 10, 2018
Answer to Question 1

Answer: Annual payments for the first five years of interest only = (r)  (PV) = .09  5,000 = 450.00. The final payment in year 6 will be the last interest payment plus the principal amount = 450 + 5,000 = 5,450.

Answer to Question 2

Answer: A
Explanation: A) The first payment will be equal to the beginning balance times the annual interest rate = 8,000  .12 = 960.00.


sdfghj

  • Member
  • Posts: 552
Reply 2 on: Jul 10, 2018
YES! Correct, THANKS for helping me on my review

TheNamesImani

  • Member
  • Posts: 334
Reply 3 on: Yesterday
Gracias!

« previous next »
 

Did you know?

An identified risk factor for osteoporosis is the intake of excessive amounts of vitamin A. Dietary intake of approximately double the recommended daily amount of vitamin A, by women, has been shown to reduce bone mineral density and increase the chances for hip fractures compared with women who consumed the recommended daily amount (or less) of vitamin A.

Did you know?

Despite claims by manufacturers, the supplement known as Ginkgo biloba was shown in a study of more than 3,000 participants to be ineffective in reducing development of dementia and Alzheimer’s disease in older people.

Did you know?

Most women experience menopause in their 50s. However, in 1994, an Italian woman gave birth to a baby boy when she was 61 years old.

Did you know?

In inpatient settings, adverse drug events account for an estimated one in three of all hospital adverse events. They affect approximately 2 million hospital stays every year, and prolong hospital stays by between one and five days.

Did you know?

There are more nerve cells in one human brain than there are stars in the Milky Way.

A Golden Retriever at 12 years old A Golden Retriever at 12 years old
The cranium of early African H. erectus KNM-ER 3733 is nearly 1.8 million years old. The cranium of early African H. erectus KNM-ER 3733 is nearly 1.8 million years old.
World Population Growth, Past 10,000 years World Population Growth, Past 10,000 years
Explain the myogenic autoregulation of the glomerular filtration rate Explain the myogenic autoregulation of the glomerular filtration rate
A non-interest-bearing five-year note for $54600.00 issued May 1, 2015, is discounted April 1, ... A non-interest-bearing five-year note for $54600.00 issued May 1, 2015, is discounted April 1, ...
Earth 430 Million Years Ago Earth 430 Million Years Ago
Video: Junction Types - Tight and Adherens Junctions

For a complete list of videos, visit our video library