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lutik1710 [3]
3 years ago
7

The purchase price of a car is $25,000. Mr. Smith makes a down payment of $5000 and borrows the balance from a bank at 6% nomina

l annual interest, compounded monthly for five years. Calculate the nearest value of the required monthly payments to pay off the loan.
Business
1 answer:
lara31 [8.8K]3 years ago
6 0

Answer:

Required monthly payments = $387

Explanation:

Loan Amortization: A loan repayment method structured such that a series of equal periodic installments will be paid for certain number of periods to offset both the loan principal amount and the accrued interest.

The monthly installment is computed as follows:

Monthly installment= Loan amount/annuity factor

Loan amount; 25,000 - 5000 = 20,000

Annuity factor = (1 - (1+r)^(-n))/r

r -monthly rate of interest, n- number of months

r- 6%/12 = 0.5% = 0.005, n = 5 × 12 = 60 <em>(there are 12 months in a year)</em>

Annuity factor = ( 1- (1+0.005)^(-60))/0.005

                       = 51.72556

Monthly installment = Loan amount /annuity factor

                                = 20,000/51.7256

                                 = 386.66

Required monthly payments = $387

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mrs_skeptik [129]

In order for more efficient workers to earn higher wages, a company would have to be using a <u>differential rate </u><u>pay </u><u>structure.</u>

<h3>What is a differential rate pay structure?</h3>
  • Workers are paid based on time taken to complete tasks.
  • Workers who finish by the time they are supposed to are paid higher.

Efficiency refers to finishing tasks in a particular time which means that those employees who finish on time are more efficient and will get a higher pay.

Find out more on<u> differential rate pay structure</u> at brainly.com/question/5044592.

4 0
2 years ago
What is the 4 MAJOR
bogdanovich [222]

Answer:

- The presence of a duty. We all have a duty to take steps to prevent injury from occurring to other people.

- The breach of a duty. The defendant must have failed to live up to his duty to prevent injury from occurring to you.

- An injury. You were injured.

- The injury resulted from the breach.

Explanation:

Hope this helps.

3 0
2 years ago
Which of the following is a disadvantage of partnerships compared to sole proprietorships?
GarryVolchara [31]
C. It is sometimes difficult for partners to agree on every business decision.
6 0
2 years ago
Manufacturer of skateboards offered a 5/2/1 chain discount to many customers. bob's sporting goods ordered 20 skateboards for a
Naily [24]
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5 0
3 years ago
You want to buy a house and will need to borrow $255,000. The interest rate on your loan is 5.89 percent compounded monthly and
Brut [27]

Answer: $1,626

Explanation:

A Mortgage payment is a type of annuity so the Present Value of an Annuity formula can be used to calculate this.

The Period is 12 months so adjustments need to be made to the interest rate and the period.

Period.

= 25 years * 12 months

= 300

Interest Rate

= 5.89/12

= 0.4908%

Present Value of the Annuity is the mortgage amount of $255,000

Present Value of Annuity is,

P = PMT ( 1 - ( 1 + r)^-n) / r

Where,

P = Present Value

PMT = payment per period

r = Interest rate

n= no. of periods

255,000 = PMT ( 1 - (1+0.4908%)^-³⁰⁰) / 0.4908%

255,000 = 156.8456 PMT

PMT = 255,000/156.8456

= $1,625.80

= <u>$1,626</u>

4 0
2 years ago
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