. Calculate the amount of the interest expense for each option. $fill in the blank 1 for alternative (1) $fill in the blank 2 for alternative (2) b. Determine the proceeds received by the borrower in each situation. Alternative 1 $fill in the blank 3 proceeds Alternative 2 $fill in the blank 4 proceeds

. Calculate the amount of the interest expense for each option. $fill in the blank 1 for alternative (1) $fill in the blank 2 for alternative (2) b. Determine the proceeds received by the borrower in each situation. Alternative 1 $fill in the blank 3 proceeds Alternative 2 $fill in the blank 4 proceeds

Pfin (with Mindtap, 1 Term Printed Access Card) (mindtap Course List)

7th Edition

ISBN:9780357033609

Author:Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk

Publisher:Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk

Chapter7: Using Consumer Loans

Section: Chapter Questions

Problem 5FPE

See similar textbooks

Similar questions

Evaluating Alternative Notes A borrower has two alternatives for a loan: (1) issue a $360,000, 60-day, 5% note or (2) issue a $360,000, 60-day note that the creditor discounts at 5%. Assume a 360-day year. a. Calculate the amount of the interest expense for each option. $fill in the blank 1 for each alternative. b. Determine the proceeds received by the borrower in each situation. (1) $360,000, 60-day, 5% simple-interest $fill in the blank 2 (2) $360,000, 60-day note discounted at 5% $fill in the blank 3 c. Alternative is more favorable to the borrower since the effective interest rate on alternative 1 is and the effective rate on alternative 2 is .
A borrower has two alternatives for a loan: (1) issue a $300,000, 120-day, 8% note or (2) issue a $300,000, 120-day note that the creditor discounts at 8%. Assume a 360-day year. a. Calculate the amount of the interest expense for each option.$ for each alternative. b. Determine the proceeds received by the borrower in each situation. (1) $300,000, 120-day, 8% interest-bearing note $ (2) $300,000, 120-day note discounted at 8% $ c. Alternative is more favorable to the borrower because the borrower .
A borrower has two alternatives for a loan: (1) issue a $390,000, 120-day, 8% note or (2) issue a $390,000, 120-day note that the creditor discounts at 8%. Assume a 360-day year. a. Compute the amount of the interest expense for each option.fill in the blank 1 of 1$ for each alternative. b. Determine the proceeds received by the borrower in each situation. Line Item Description Amount (1) $390,000, 120-day, 8% interest-bearing note $fill in the blank 2 (2) $390,000, 120-day note discounted at 8% $fill in the blank 3
(J) A borrower has two alternatives for a loan: (1) issue a $185,000, 60-day, 4% note or (2) issue a $185,000, 60-day note that the creditor discounts at 4%.a. Compute the amount of the interest expense for each option.b. Determine the proceeds received by the borrower in each situation.c. Which alternative is more favorable to the borrower? Explain.
Evaluating Alternative Notes A borrower has two alternatives for a loan: (1) issue a $660,000, 120-day, 6% note or (2) issue a $660,000, 120-day note that the creditor discounts at 6%. Assume a 360-day year. a. Calculate the amount of the interest expense for each option.$fill in the blank 1 for each alternative. b. Determine the proceeds received by the borrower in each situation. (1) $660,000, 120-day, 6% interest-bearing note $fill in the blank 2 (2) $660,000, 120-day note discounted at 6% $fill in the blank 3 c. Alternative is more favorable to the borrower because the borrower .
Evaluating alternative notes A borrower has two alternatives for a loan: (1) issue a $510,000, 120-day, 9% note or (2) issue a $510,000, 120-day note that the creditor discounts at 9%. Assume a 360-day year. a. Compute the amount of the interest expense for each option. for each alternative. b. Determine the proceeds received by the borrower in each situation. (1) $510,000, 120-day, 9% Interest-bearing note (2) $510,000, 120-day note discounted at 9% c. Alternative. ) is more favorable to the borrower because the borrower
Evaluating Alternative Notes A borrower has two alternatives for a loan: (1) issue a $360,000, 60-day, 5% note or (2) issue a $360,000, 60-day note that the creditor discounts at 5%. Assume a 360-day year. a. Compute the amount of the interest expense for each option.$ for each alternative .b. Determine the proceeds received by the borrower in each situation (1) $360,000, 60-day, 5% simple-interest $ (2) $360,000, 60-day note discounted at 5%
Calculating interest and APR of installment loan. Assuming that interest is the only finance charge, how much interest would be paid on a 5,000 installment loan to be repaid in 36 monthly installments of 166.10? What is the APR on this loan?
Assume a borrower is given the following options for payment of a $100,000 loan: 5-year amortizing loan paying annual interest rates of 8%5-year non-amortizing loan with principal payment at maturity paying annual rates of 8% 5-year amortizing loan with interest payments only of 8% for years 1-3 and principal of $50,000 for years 4-5. Show the payments for all three loans, including interest and principal payments, and balances every year.
Amortization (pymt){(1+r/n)^r*n/ r/n -1} = (pymt)(1+r/n) Investigate the effect of the term on simple interest amortized auto loans by finding the monthly payment and the total interest for a loan of $12,000 at 9 7/8% interest if the term is the following. (Round your answers to the nearest cent.) (a) three years payment $ total interest $ (b) four years payment $ total interest $ (c) five years payment $ total interest $
Your bank offers the following options on a $100,000 mortgage: 1. A 15-year, 4% loan with no points 2. A 15-year, 3.5% loan, with 1.5 discount points.. The interest portion of the first payment (INT) is. for option 2. $333.33: $291,67 None of the above. O $4,000; $3,500 O $406.36; $423.21 for option 1, and
A loan is to be amortized by n level annual payments of X where n > 5. You are given (1) The amount of interest in the first payment is 604.00 (2) The amount of interest in the third payment is 593.75 (3) The amount of interest in the fifth payment is 582.45 Calculate X.