I need help with 9 and 10 5 Zampa Credit Corp. wants to earn an effective annual

Question

I need help with 9 and 10

5 Zampa Credit Corp. wants to earn an effective annual return on its consumer loans of 7.676 percent per year. The bank uses daily compounding on its loans. What interest rate is the bank required by law to report to potential borrowers? 6 You have taken an auto loan of S61,600 from Toyoto. You're prepared to make monthly payments of $640, beginning at the end of this month. How many years will it take to pay off your loan if the car dealer charges 8 percent interest rate? 7 You want to borrow $73,200 from your local bank to buy a new sailboat. You can afford to make monthly payments of $1,380, but no more. Assuming 4monthly compounding, what is the highest rate per year you can afford on a 78- month loan? 8 Today a running back signed a 5 year contract. The contract called for $6.6 million immediately and a salary of $3.5 million in 1 year, $9.5 million in 2 years, $10 million in 3 years, $9.4 million in 4 years and, and $10.5 million in 5 years. If the appropriate interest rate is 5.4%, what is the worth of this deal to the player? Assume all payments other than the first $6.6 million are paid at the end of the year. Put answer in million S. E.g., $27.6 million as 27.6. 9 You are planning your retirement in 10 years. You currently have $117,000 in a bond account. You plan to add $11,000 per year at the beginning of each of the next 10 years to your bond account. The bond account will earn a return of 7 percent. How much will be available in your retirement account in 10 years? 0 This year you sold an 1884-O Morgan silver dollar for $4,900. What was the 7rate of return on this investment? (Hint: a silver dollar was worth a dollar!)

Explanation / Answer

9. We have invested @ $11000 for each of 10 years and we already have $117,000, so we have to calculate interest for 10 years @10% and at the 10th year we will get interest as well as principal.
In below table column C multiplied by years because we have invested 11000 every year so we will get interest amount increases every year

10. Sales price $4900 (Given in question)
   Original price $1 (Given in question)
Rate of return = (Sales price - Original price)/Original price = (4900-1)/1 = 4899
Rate of return calculated in % so we have to multiply by 100 = 4899*100 = 489900% Ans.

Years Interest amount on $11,000 (11000*7%) Interest amount every year (11000*Years*7%) Interest amount on $ 117,000*7% Principal Total A B C=A*B D E C+D+E 1                        770.00    770.00                 8,190.00        8,960.00 2                        770.00 1,540.00                 8,190.00        9,730.00 3                        770.00                 2,310.00                 8,190.00      10,500.00 4                        770.00                 3,080.00                 8,190.00      11,270.00 5                        770.00                 3,850.00                 8,190.00      12,040.00 6                        770.00                 4,620.00                 8,190.00      12,810.00 7                        770.00                 5,390.00                 8,190.00      13,580.00 8                        770.00                 6,160.00                 8,190.00      14,350.00 9                        770.00                 6,930.00                 8,190.00      15,120.00 10                        770.00                 7,700.00                 8,190.00      15,890.00 10      117,000.00    117,000.00 10      110,000.00    110,000.00 Balance available in 10th Year      351,250.00 Ans.

Related Questions

Navigate

• Browse (All)
• Browse I
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.