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3 years ago

A family buys a car for $25,000. The family pays $2,500 cash and takes out a loan for the rest at 8% simple interest.

Business

1 answer:

Rom4ik [11]3 years ago

8 0

Answer:

A. $150

Explanation:

Amount of car = $25,000

Initial payment = $2,500

If the family takes out a loan for the rest, the amount taken as loan

= $25,000-$2,500

= $22,500

If interest of 8% is charged on the loan for 5years, the interest charged for the 5years can be gotten using simple interest formula:

Simple interest = principal × rate × time/100

Simple interest = $22,500×8×5/100

Simple interest = $9,000

If total interest paid for 5years = $9,000

The family monthly payment will be:

= $9000/5×12 (since there are 12months in a year)

= $9,000/60

= $150

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zloy xaker [14]

The future value of the account established by the wealthy uncle will be $3,943.86 after 23 years at the two interest rates.

<h3>What is future value?</h3>

The future value of an amount is the value obtained in the future after compounding at an interest rate.

The future values after years 9 and 23 can be determined using an online finance calculator as follows:

<h3>Future Value of $2,100 after 9 years:</h3>

N (# of periods) = 9 years

I/Y (Interest per year) = 4%

PV (Present Value) = $2,100

PMT (Periodic Payment) = $0

<u>Results:</u>

FV = $2,988.95

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<h3>Future Value of $2,988.95 after 14 years:</h3>

N (# of periods) 14 (23 - 9)

I/Y (Interest per year) = 2%

PV (Present Value) = $2,988.95

PMT (Periodic Payment) = $0

<u>Results:</u>

FV = $3,943.86

Total Interest $954.91

Thus, the future value of the account established by the wealthy uncle will be $3,943.86 after 23 years at the two interest rates.

Learn more about future values at brainly.com/question/24703884

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2 years ago

The first-year NOI for an office building is $150,000. A lender is willing to provide financing up to a 1.5 debt-coverage ratio.

Hoochie [10]

Answer:

the maximum loan size is $1,278,335.62

Explanation:

The computation of the maximum loan size is as follows:

= (NOI first year ÷ debt coverage rate) × 1 ÷ (rate of interest) × (1 - 1 ÷ (1 + rate of interest)^number of years)

= ($150,000 ÷ 1.5) × 1 ÷ (6%) × (1 - 1 ÷ (1 + 6%)^(25))

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