Gitman: Principl Manageri Finance_15 (15th Edition) (What's New in Finance)
15th Edition
ISBN: 9780134476315
Author: Chad J. Zutter, Scott B. Smart
Publisher: PEARSON
expand_more
expand_more
format_list_bulleted
Videos
Question
Chapter 5, Problem 5.57P
Subpart (a)
Summary Introduction
To calculate: Interest rate.
Subpart (b)
Summary Introduction
To discuss: Which loan is more preferable.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
1. Exercise One: Jessica decides to take a $25,000 to help her cover her tuition expenses.
The tenor of the loan is 10 years, and the interest rate is 6.75%. Repayments will be
made on a monthly frequency. Based on the aforementioned information, and the
material covered in class, (a) use the PMT function in Excel to find the fixed total
payment, (b) verify your answer from (a) by programming the present value annuity
formula as shown in class, (c) create an amortization schedule for this loan, (d) create a
bar chart showing the Fixed Total Payment, Interest Paid, and Principal Paid.
Find the interest earned on $5,750 deposited into a savings account for 3 1/2 years at an annual interest rate of 4 1/2%
a. What formula should be used?
b. What are you trying to find and what variable does it represent in the formula?
c. Solve the problem showing all of your work (must show all steps!!)
d. Interpet your answer using a complete sentence
You may use the box below to upoload a picture of your written explanation or type it out in the box. Use the "mountain"
button to add pictures.
View History Bookmarks Window Help
E
Amortized Loans - 21516 MAT142 Topics In College Math
DERIVITA
lit
(
Tiana Klughart
EA
$
Miguel can afford to pay $150.00 per month for a car. He has $6,000.00 saved up for
a down payment. His bank is offering amortized car loans for 1.5% compounded
monthly.
If he takes out a 5-year loan, what is the price of the most expensive car he can afford?
How much will the car cost him in total?
$
CHECK ANSWER
a
D2L 5.3 Amortized Loans - 21516 MAT142 Topics In College Math
**** -
d2l.pima.edu
3D
5
5.3
****
C
Question 4 of 8
M
E
**
C
C
Q
Q
Qu
Su
Chapter 5 Solutions
Gitman: Principl Manageri Finance_15 (15th Edition) (What's New in Finance)
Ch. 5.1 - What is the difference between future value and...Ch. 5.1 - Define and differentiate among the three basic...Ch. 5.2 - Prob. 5.3RQCh. 5.2 - Prob. 5.4RQCh. 5.2 - Prob. 5.5RQCh. 5.2 - Prob. 5.6RQCh. 5.2 - Prob. 5.7RQCh. 5.3 - What is the difference between an ordinary annuity...Ch. 5.3 - What are the most efficient ways to calculate the...Ch. 5.3 - How can the formula for the future value of an...
Ch. 5.3 - Prob. 5.13RQCh. 5.3 - What is a perpetuity? Why is the present value of...Ch. 5.4 - How do you calculate the future value of a mixed...Ch. 5.5 - What effect does compounding interest more...Ch. 5.5 - Prob. 5.21RQCh. 5.5 - Differentiate between a nominal annual rate and an...Ch. 5.6 - How can you determine the size of the equal,...Ch. 5.6 - Prob. 5.27RQCh. 5.6 - How can you determine the unknown number of...Ch. 5 - Learning Goals 2, 5 ST5-1 Future values for...Ch. 5 - Learning Goal 3 ST5-2 Future values of annuities...Ch. 5 - Prob. 5.3STPCh. 5 - Learning Goal 6 ST5-4 Deposits needed to...Ch. 5 - Assume that a firm makes a 2,500 deposit into a...Ch. 5 - Prob. 5.2WUECh. 5 - Prob. 5.3WUECh. 5 - Your firm has the option of making an investment...Ch. 5 - Joseph is a friend of yours. He has plenty of...Ch. 5 - Jack and Jill have just had their first child. If...Ch. 5 - Prob. 5.1PCh. 5 - Learning Goal 2 P5-2 Future value calculation...Ch. 5 - Prob. 5.4PCh. 5 - Prob. 5.5PCh. 5 - Learning Goal 2 P5- 6 Time value As part of your...Ch. 5 - Learning Goal 2 P5-7 Time value you can deposit...Ch. 5 - Learning Goal 2 P5-8 Time value Misty needs to...Ch. 5 - Learning Goal 2 P5- 9 Single-payment loan...Ch. 5 - Prob. 5.10PCh. 5 - Prob. 5.11PCh. 5 - Prob. 5.12PCh. 5 - Prob. 5.13PCh. 5 - Time value An Iowa state savings bond can be...Ch. 5 - Time value and discount rates You just won a...Ch. 5 - Prob. 5.16PCh. 5 - Cash flow investment decision Tom Alexander has an...Ch. 5 - Learning Goal 2 P5-18 Calculating deposit needed...Ch. 5 - Future value of an annuity for each case in the...Ch. 5 - Present value of an annuity Consider the following...Ch. 5 - Learning Goal 3 P5-21 Time value: Annuities Marian...Ch. 5 - Learning Goal 3 P5-22 Retirement planning Hal...Ch. 5 - Learning Goal 3 P5-23 Value of a retirement...Ch. 5 - Learning Goal 2, 3 P5-25 Value of an annuity...Ch. 5 - Prob. 5.26PCh. 5 - Prob. 5.30PCh. 5 - Learning Goal 4 P5-31 Value of a single amount...Ch. 5 - Value of mixed streams Find the present value of...Ch. 5 - Prob. 5.33PCh. 5 - Prob. 5.34PCh. 5 - Prob. 5.36PCh. 5 - Prob. 5.37PCh. 5 - Changing compounding frequency Using annual,...Ch. 5 - Prob. 5.39PCh. 5 - Prob. 5.40PCh. 5 - Compounding frequency and time value You plan to...Ch. 5 - Learning Goals 3, 5 P5-42 Annuities and...Ch. 5 - Prob. 5.43PCh. 5 - Prob. 5.44PCh. 5 - Prob. 5.45PCh. 5 - Prob. 5.46PCh. 5 - Prob. 5.47PCh. 5 - Loan amortization schedule Joan Messineo borrowed...Ch. 5 - Prob. 5.49PCh. 5 - Prob. 5.50PCh. 5 - Prob. 5.52PCh. 5 - Prob. 5.53PCh. 5 - Prob. 5.54PCh. 5 - Prob. 5.55PCh. 5 - Prob. 5.56PCh. 5 - Prob. 5.57PCh. 5 - Number of years needed to acccumulate a future...Ch. 5 - Prob. 5.59PCh. 5 - Prob. 5.60PCh. 5 - Time to repay Installment loan Mia Saito wishes to...
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, finance and related others by exploring similar questions and additional content below.Similar questions
- Unsubsidized Student Loans Step 1 You receive a 10-year unsubsidized student loan of $33,000 at an annual Interest rate of 5.8%. Use simple interest to find your new total loan amount after you graduate in 4 years. (Round your answer to the nearest cent.) $7656 x 40656.00 Step 2 Your new total loan amount is $40656.00. What are your monthly loan payments for this loan? (Round your answer to the nearest cent.) %24 |x Submit Skip (you cannot come back)arrow_forwardModule 2.6: Understandin... Question Calculate the total cost of a 15-year, $20,000 student loan at an interest rate of 4.5% per year compounded monthly. Round to the nearest dollar. CURRENT OBJECTIVE Evaluate student loan options Provide your answer below: @ W S 3 e d C $ 4 r f 0 % 5 t A 6 Oll y h & 7 FEEDBACK J * 8 j Von b MORE INSTRUCTION m ( 9 k O O SUBMIT Parrow_forward4 Math Applications MyOpenMath You can afford a $200 per month car payment. You've found a 5 year loan at 7% interest. How big of a loan can you afford? Submit Question Search 1 04arrow_forward
- Goal To use recursive sequence to determine the amount money owed on a loan after months Role You are a loan officer at a mortgage company. Audience Jim and Joan Miller are customers applying for a mortgage. Situation Jim and Joan Miller are borrowing $120,000 at 6.5% per annum compounded monthly for 30 years (360 months) to purchase a home. Their monthly payment is determined to be $758.48. Performance Task You need to present Jim and Joan with a report detailing the following: • Arecursive formula for their balance after each monthly payment has been made. • To do this, use the formula: a, = an-1 (1+r) – 758.48 A determination of Jim and Joan's balance after the first payment. Don't forget the interest affecting their payment! • Use a spreadsheet or graphing utility to create a table showing their balance after each monthly payment. • Determine when the balance will be below $75,000. • Determine when the balance will be paid off. • Determine the interest expense when the loan is…arrow_forwardO CONSUMER MATHEMATICS Finding the monthly payment, total payment, and interest for a... When Laura bought her house, she got her mortgage through a bank. The mortgage was a personal, amortized loan for $99,500, at an interest rate of 3.75%, with monthly payments for a term of 40 years. For each part, do not round any intermediate computations and round your final answers to the nearest cent. If necessary, refer to the list of financial formulas. (a) Find Laura's monthly payment. (b) If Laura pays the monthly payment each month for the full term, find her total amount to repay the loan. $0 (c) If Laura pays the monthly payment each month for the full term, find the total amount of interest she will pay. $0 X Monthly Payment Formula M= P r 12 r 1- ( 1 + 12 ) - 12tarrow_forwardSuppose that you decide to borrow $13,000 for a new car. You can select one of the following loans, each requiring regular monthly payments. Installment Loan A: three-year loan at 6.3% Installment Loan B: five-year loan at 4.8% P. Use PMT = to complete parts (a) through (c) below. - nt 1- a. Find the monthly payments and the total interest for Loan A. The monthly payment for Loan A is $. (Do not round until the final answer. Then round to the nearest cent as needed.) The total interest for Loan A is $. (Round to the nearest cent as needed.) b. Find the monthly payments and the total interest for Loan B. The monthly payment for Loan B is $. (Do not round until the final answer. Then round to the nearest cent as needed.) The total interest for Loan B is $. (Round to the nearest cent as needed.) MacBook Airarrow_forward
- 13. Problem 4-25 (Repaying a Loan) E eBook Repaying a Loan While Mary Corens was a student at the University of Tennessee, she borrowed $10,000 in student loans at an annual interest rate of 7%. If Mary repays $1,400 per year, then how long (to the nearest year) will it take her to repay the loan? Do not round intermediate calculations. Round your answer to the nearest whole number. year(s) A-Z go.arrow_forwardYou can afford a $200 per month car payment. You've found a 5 year loan at 7% interest. How big of a loan can you afford? S Submit Question Q Search hp Oarrow_forwardView History Bookmarks Bookmarks Window Help rtized Loans - 21516 MAT142 Topics In College Math DERIVITA Tiana Klughart $ CHECK ANSWER O John is looking for a new car. He has a down payment of $1,750.00 and wants to pay $450.00 per month for 4 years. The best deal he found for an amortized loan is his local bank, at a rate of 2.75%. What is the highest price car he should consider buying? 7 a $ **** -- d2l.pima.edu % D2L 5.3 Amortized Loans - 21516 MAT142 Topics In College Math Activity Details 5 СЛ Chapter 5.3 S * S C 307+ Question 3 of: ( C Sarrow_forward
- t View History Bookmarks Window Help Amortized Loans - 21516 MAT142 Topics In College Math DERIVITA Tiana Klughart $ How much will the car cost, in total? $ A Chevrolet Sonic Hatchback costs $15,015.00. With a 9% down payment, you can have an amortized loan for 6 years at a rate of 3.5%. What will the monthly payment be? How much money will be paid in interest? $ DZL 5.3 Amortized Loans - 21516 MAT142 Topics In College Math CHECK ANSWER PNPITE d2l.pima.edu 3D X 5 Ĉ Question 1 o www.arrow_forwardYou lend a friend $10,000, for which your friend will repay you $27,027 at the end of 5 years. What interest rate are you charging your "friend"? Question content area bottom Part 1 The interest rate you are charging your friend on the loan is enter your response here%.arrow_forwardYou can afford a $350 per month car payment. You've found a 5 year loan at 6% interest. How big of a loan can you afford? Submit Question Search hparrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Excel Applications for Accounting PrinciplesAccountingISBN:9781111581565Author:Gaylord N. SmithPublisher:Cengage Learning
Excel Applications for Accounting Principles
Accounting
ISBN:9781111581565
Author:Gaylord N. Smith
Publisher:Cengage Learning
5 Steps to Setting Achievable Financial Goals | Brian Tracy; Author: Brian Tracy;https://www.youtube.com/watch?v=aXDuLxEJqBo;License: Standard Youtube License