1) for a period of two years. During the first year, the quarterly payment is for $300, while in the second year, the quarterly payment increases to $400. Assume that the bank is charging an interest rate of 3% quarterly. Show your work. Calculate the value of a loan today that will be repaid with quarterly payments
Q: You are now about to pay P50,000 to a friend whom you have borrowed some money fifteen months ago.…
A: The worth of an asset at a future date is called future value. It is the present value multiplied by…
Q: .If the rate of interest is 8% compounded quarterly, find the nominal rate of interest.
A: Answer is given below
Q: Annabelle loaned a certain amount from ABC bank. She agrees to pay P5000 at the beginning of each…
A: Pay = 5000 time Period = 6 years. interest rate = 10% compounding quater
Q: In one instance, a financial institution loaned you $60,000 for two years at an APR of 5.75% for…
A: First instance: Given , Principal = $60000 APR = 5.75% Time period = 2 years Thus, simple interest =…
Q: Hunan bought a car priced at $15,800 for 15% down and equal monthly payments for four years. If…
A: Monthly payments refers to a borrower pays down some of the outstanding balance with interest and…
Q: Which formula is correct for the simple interest calculation? Select one: a. F = P(1+i/n) b. F =…
A: Simple interest is a cost one pays on a loan or earnings on the savings account. The formula for…
Q: You have borrowed $28,000 at an interest rate of 12% compounded annually. Equal payments will be…
A: According to question, given that Borrowing amount $28,000@12%/year a) AP represented annual…
Q: What is the accumulated amount of a 8-year annuity paying ₱ 1,067 at the end of each year, with…
A:
Q: Ben Franklin's gift of $3,000 to New York City grew to $2,000,000 in 200 years. At what interest…
A: Given Ben Franklin's gift initial value (P)= $3000 Value of gift after 200 years (F) = $2,000,000…
Q: How much money do you need to deposit in a bank each month if you are planning to have $5000 in four…
A:
Q: Calculate the future value (rounded to the nearest whole number) of monthly deposits of R500, made…
A: Future value can be calculated as follows. Monthly interest rate (i) is 0.0033. Time period is 360.…
Q: A loan amounting to ₱ 1,000,000.00 is to be paid within 5 years. If the bank offers 12% nominal rate…
A: Equivalence Monthly Installments or EMI is defined as a method used to repay a loan with easy…
Q: Compare the interest earned on $8,000 for 15 years at 8% simple interest with the amount of interest…
A: A fixed percent of interest rate on the principal amount over a specific time period is referred to…
Q: What is the nominal rate of interest compounded continuously for 10 years if the compound amount…
A: Nominal interest is the interest before adjusting inflation.
Q: A man borrowed P280,000 and agrees to pay the loan at the end of each month for 48 months at 1.5%…
A: Given Borrowed amount P=280,000 Interest rate =1.5% compounded monthly. Time (n) = 48 months
Q: Given the situation , choose the correct formula to solve the problem: A personal account earmarked…
A: When a series of payments(P) are received by an individual at equal/regular time intervals, he is…
Q: n an ordinary annuity (uniform series of payments) if the nominal rate of interest is 8% compounded…
A: a.) CAPITAL RECOVERY FACTOR When compounded quarterly the interest rate is divided by 4 and the…
Q: How much do ten ₱ 5,811 quarterly payments amount at present, if the interest rate is 2 compounded…
A: Given the quarterly payment = 5811 Interest rate = 2%/4 = 0.5% Number of compounding period = 10
Q: ill deposited 100,000 pesos in bank account earning interest at the rate of 10% compounded…
A: Amount deposit = 100,000 r = 10% n = 10
Q: . If you borrowed $24,000 at 12% annual interest. You agreed to repay the loan with five equal…
A: Here we calculate the following by using the given information and conclude the answer so the…
Q: If you borrow $ 30,000 at 6% simple interest per year for seven years, how much will you have to…
A: Simple Interest = (Principal * Rate * Time) / 100 ie SI = (P * R * T) / 100 Amount = Principal +…
Q: What simple interest rate (in %) is equivalent to 5% compounded quarterly if money is invested for 9…
A: Answer to the question is as follows
Q: Describe the Financial Functions to determine a Loan's Principal andInterest Payments between two…
A: The financial function that determine loan’s principal amount is PPMT. This function is used to…
Q: How long does it take an investment of P300,000 to double if it invested at 10% interest compounded…
A: The future value of a given amount invested is a function of interest rate, periods of investment,…
Q: If you had BD 4,500 now and invested at 13% interest compounded annually, how much would it be worth…
A: Investment Amount = 4500 r = 13% n = 8
Q: If P25,000 is invested at 8% interest compounded quarterly, how many years will it take for this…
A: Quarterly nominal interest rate = 8% / 4 = 2% Let number of quarters be N. Then 25,000 x (1.02)N =…
Q: On January 1, you deposit $5,000 in a credit union that pays 8% nominal annual interest, compounded…
A: Interest rate is the amount charged on an amount of money by a lender from a borrower to use the…
Q: Suppose that $5,000 is placed in a bank account at the end of each quarter over the next 9 years.…
A: GIVEN P = $5000 No. of periods (n)= 9*4 = 36 compounded = 14%
Q: company borrowed $100000 from a bank at an interest rate of 10% compounded monthly. The loan will be…
A: This annuity problem where equal payment will be made across the 36 periods to payoff the loan…
Q: Q: You borrow $20,000 to be repaid in equal instalments over the following four years. The interest…
A: Installments that will be paid at the end of every year is estimated as follows: Principal=Cash Flow…
Q: 1) What is the present value of the following series of payments: $500 made at the end of every year…
A: Given an exact rate of come, gift price (PV) is that the current price of a future add of cash or…
Q: Mr. Mallari borrowed P200, 000. The terms of the loan are 10% interest for 10 years with uniform…
A: Borrowed = 200,000 interest rate = 10% time Period = 10 year
Q: You take out a loan of $12,000 to pay for a piece of equipment. You plan to repay the loan in 16…
A: Suppose you want to pay the first installment at the end of the year. So 16 equal payments of $1100…
Q: A businessman borrowed P 200,000 and agrees to pay P 47,720 annually for x years at the rate of 6%…
A: The formula to compute continuously compounded interest is as follows: P(t)=P0ert where P(t) = Value…
Q: 863,171 is placed in an account at 3.66% compounded quarterly for 7 years. How much is in the…
A: pv = P863,171
Q: Calculate interest on a 90-day $5,000
A: Given, Time = 90 days (consider 360 days in a year) Interest = 11% Principal = $5000
Q: What is the maturity date of a loan taken out on September 9, 1998 for 125 days?
A: The loan is taken out on September 9, 1998, for 125 days So maturity date of this loan will be 125…
Q: What is the current value of a P 200.00 annuity be made at the beginning of each year, for 3 years…
A: Since the Annuity is made at the beginning of each year, so the formula for present value is: PV= z…
Q: The owner of Sebastopol Tree Farm deposits $400 at the end of each quarter into an account paying 5%…
A: D=$400i=5%4=0.0125 (divided by 4 as the interest is compunded quaterly)n=9×4=36 (multiplied by 4 as…
Q: At 8% annual interest compounded quarterly, how long will it take to become a millionaire if you…
A: Interest is the amount received in excess of the investment to an investor. The two methods of…
Q: What should be the price of perpetuity that pays P5.000 every month with an interest rate of 8%…
A: Given payment each month = 5000 Interest rate = 8 % compounded annually Total payment each year =…
Q: What equal monthly payments will repay an original loan of $10,000 in six months at a rate of 6%…
A: P= $10000 n=6 r=6%
Q: Suppose Alice decides to put some money in a new account that compounds twice per year. At the…
A: Compounding Compounding is the act of reinvesting an asset's profits, whether they be from capital…
Q: A trust will pay you $50,000 per year for 30 years starting 1 year from now. Assuming an interest…
A: Cash flow is the movement of money in and out of a company. Cash received signifies inflows, and…
Q: You have borrowed $20,000 at an interest rate at 10% compounded annually. Equal payments will be…
A: Part-1Annual Instalment is computed by dividing the loan amount with annuity PVF for 3 years at…
Q: Compare the interest earned by $9,000 for six years at 7% simple interest with interest earned by…
A: Simple interest and compound interest are earned on initial amount deposited but with sufficiently…
Q: A 16-year annuity pays $1,300 per month, and payments are made at the end of each month. The…
A: Here we calculate the present value of the annuity by using the given information , so the…
Q: uppose you want to withdraw $1500 every 6month from an account that's pays 14% interest compounded…
A: Given 6-Monthly withdraw amount A= $1500 Rate of interest = 14% compounded twice a year or…
Step by step
Solved in 2 steps
- a. What is the effective annual interest rate if the nominal annual interest rate is 10%, compounded quarterly? b. What is the effective annual interest rate if the nominal annual interest rate is 10%, compounded monthly? c. What is the effective annual interest rate if the nominal annual interest rate is 10%, compounded daily? d. What is the effective annual interest rate if the nominal annual interest rate is 10%, compounded continuously? e. At what compounding period does the effective annual interest rate very closely approximate continuous compounding? (Consider to the nearest 0.0001)How much money will you have in seven yearsif you deposit $7,000 in the bank at 8.5% interestcompounded daily?If you borrowed $24,000 at 12% 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 deposit $200 each month into an account earning 5% interest compounded monthly. a) How much will you have in the account in 15 years? $ b) How much total money will you put into the account? $ c) How much total interest will you earn? $1. A bank charges 1.5% per month on a loan. Find the equivalent nominal rate of interest. 2. A financing company charges 1.5% per month on a loan. Find the equiv alent effective rate of interest. 3. A nominal rate of 12% compounded monthly is equal to an effective rate of interest. 4. Convert 16% compounded semi-annually to equivalent nominal rate which is compounded daily.1.What is the accumulated amount of an annuity paying P30,000 at the end of each year for 7 years with interest at 15% compounded annually? 2.Miss Dela Cruz borrows P500,000 at 12% compounded annually agreeing to repay the loan in 15 equal annual payments. How much of the original principal is still unpaid after he has made the 8th payment.
- What effective annual interest rate corresponds to the following situations? a. nominal interest rate of 10% compounded semi-annually b. nominal interest rate of 6% compounded monthly c. nominal interest rate of 8% compounded quarterly2.If the rate of interest is 8% compounded quarterly, find the nominal rate of interest.QUESTION 1 Muhammad takes out a loan of $ 2,130, at 8% simple interest, for 8 years. How much will he pay back at the end of year 8? QUESTION 2 Calculate the amount of interest on an investment of AED 103,971 at 8% simple interest for 5 years. QUESTION 3 If you deposit today $7,335 in an account for 6 years and at the end accumulate $10,885, how much compound interest rate (rate of return) you earned on this investment ? QUESTION 4 You will deposit 12,025 at 10% simple interest rate for 9 years, and then move the amount you would receive to an investment account at 12 % compound rate for another 3 years. How much money would you have at the end of the entire period ?
- Compute the future value of the following deposits made today:a. $10,000 at 6.75% compounding annually for 10 yearsb. $10,000 at 6.75% compounding quarterly for 10 yearsc. $10,000 at 6.75% compounding monthly for 10 years Compute the interest earned on the deposits made.To have a total of $10,000 after 8 years, what principal do you have to deposit in a 4.5 percent saving account compounded monthly?1. Accumulate P 3,000 for 9 years at 6 percent interest compounded quarterly. How much is the compound interest earned? 2. Determine the nominal rate which if converted quarterly could be used instead of 12 percent compounded monthly. What is the corresponding effective rate?