Analysis
Essay by Leslie Ramirez • May 11, 2016 • Coursework • 1,124 Words (5 Pages) • 1,227 Views
Question 1
The purchase price of a used car is $6, 295 , if a down payment of $150 is put on the car, and the total of the monthly payments is $7,980 and the car is paid off in 60 months, how much of the price is financed, what is the total finance charge and what is the APR from the Annual Percentage Rate per $100 table?
$6,250-$150[pic 1]
$7,980-46,145= $1,835 Finance charge
$1,835/ $6,145 x 100= $29.86
APR is in between 10.75% and 11%, Therefore $29.86 is closest to 10.75%
Question 2
Using the Future Value Table 12.1, find the Future Value and the Interest, based on the following information:
Time: 6 months; Principal: $12,000; Rate: 6%, compounded quarterly.
6 month is equal to 2 periods
6%/4= 1.5%
FV of $1= 1.0302
$12,000 x 1.0302= $12,362.40 FV
$12,362.40-$12,000= $362.40 Interest
Question 3
Calculate the finance charge rebate and payoff amount, given that the loan amount is $8,000 for 24 months with monthly payments of $425. But the loan is paid off early, at the end of 10 months.
(24)($425)= $10,200
(10)(425)= $4,250
Diff is $5,950
$10,200-$8,000= $2,200 24-10=14
105/300x $2,200= $770 Finance Charge Rebate
$5,950-$770= $5,180 Payoff Amount
Question 4
Using the Present Value Table 12.3, given the following information:
Amount desired at end of period: $17,600; Time: 7 years; Rate: 12%, Compounded Quarterly; find
Number of Table Periods; Rate used ; Present Value Table Factor; and Present Value of the amount desired at the end of the 7 year period.
Desired #of table periods Rate used PV table factor
$17.600 7x4=28 12%/4=3% .4371
PV amount desired
$17,600x.4371=$7,692.96
Question 5
John Smith bought a new log cabin for $65,000 at 11.75% interest for 30 years. As a spread sheet in Excel, prepare an amortization schedule for the first three periods. Show the portion of each payment paid for interest and to principal. (Do not leave Bb, but bring up Excel, create spread sheet, copy it and paste into Bb.)
John Smith | Rate | |||||
Price $65,000 | 11.75% | |||||
Portion to | ||||||
Payment # | Principal | Interest | Principal Reduction | Balance | ||
1 | $65,000 | $636.64 | $20.04 | $64,979.96 | ||
2 | $64,979.96 | $636.26 | $20.24 | $64,959.72 | ||
3 | $64.959.72 | $636.06 | $20.44 | $64,939.28 | ||
$65,000/$1000= 65x $10.10= $656.50 Monthly Payment Question 6 What is the total cost of interest if the selling price of a home is $87,000, the down payment is $9,000 the rate of interest is 6.5% and the term of the mortgage is 15 years? |
$87,000-$9,000= $78,000
15 x 12= 180
$78,000/$1000= 78x$8.72= $680.16
$680.16x180= $122,428.80
$122,428.80-$78,000=$44,428,80 Total cost of interest
Question 7
Oprah Winfrey has closed on a 35 acre estate near Santa Barbara, CA, for $30,000,000. If Oprah puts 25% down and finances the balance at 7.5% for 25 years, what would her monthly payments be?
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