1. Juan borrowed $3900 from the bank in order to buy a new dune buggy. He will pay it off by equal payments at the end of each week for 2 years. The annual interest rate is 6.5%. Use Excel to determine the size of payments. What is the total they will pay on the loan? What is the total interest paid? Express your answers rounded to the nearest cent!

Payments: $

Total paid: $

Total interest: $

2. Jeremy is purchasing a $130000 house. The down payment is 25% of the price of the house. He is given the choice of two mortgages: (Express all answers rounded correctly to the nearest cent!)

a) a 25-year mortgage at a rate of 8.5%. Find

(i) the monthly payment: $

(ii) the total amount of interest paid: $ b) a 15-year mortgage at a rate of 8.5%. Find

(i) The monthly payment:

(ii) the total amount of interest paid:

3. Jeremy is buying a new sailing boat. He can afford $1400 monthly payments. If the store charges 3.5% interest rate, compounded monthly, and Jeremy wants to pay off his loan in 7 years. Use Excel to determine what the largest loan he can get with these terms. Express your answer rounded to the nearest cent!

4. Neal is buying a new apartment. He can afford a mortgage payment of $1660 a month, and a down payment of $13000. He obtained a 18-year loan at 3.95% compounded monthly. Use Excel to determine what the most expensive apartment he can buy under these terms. How much will Neal pay in interest over the 18-year years? Express your answer rounded to the nearest cent!

Apartment price = $ Interest paid = $

5. Your brother is considering the purchase of a home rather than renewing the lease on his two-bedroom apartment. He is currently paying $750 per month for rent. He has asked you to help decide what sort of home he might be able to afford with his current monthly rent payment. His bank offers first-time home buyers (with good credit) a 30-year mortgage at a fixed rate of 5.4%. Use this information to answer the questions below. Express your answers rounded correctly to the nearest cent!

(i) If the cost of insurance and property taxes is about $250 per month in the neighborhood where he'd like to live, what monthly mortgage payment can he afford? (Use a modified version of the Total Expense Ratio) Payment =

(ii) Use Excel's PV function to determine how much your brother could afford to borrow for a home. Amount to Borrow =

6. Tobin and his wife, Samantha, both work and have a combined gross income of $110000 per year. They estimate the property taxes on their condo will be $1100 and insurance would be about $1420 per year. Samantha has a car payment of $215 per month And Tobin has a student loans payment of $240 per month. Use this information to answer the questions below. Express your answers rounded correctly to the nearest cent!

(i) Determine how much of a monthly mortgage Tobin and Samantha can afford. (Use the Total Expense Ratio from your class materials.) Payment =

(ii) If the couple can get a 20-year mortgage with a fixed rate of 5.4%, use Excel's PV function to determine how much house they could afford Amount to Borrow =

7. You will need to download the Excel Amortization Spreadsheet from your Ivy Learn course to complete this question.

Martha will borrow $17000 to buy a car using a 4.65% APR loan compounded monthly for 6 years. Express your answers rounded to the nearest cent! How much of their first payment goes towards interest? How much of their first payment goes towards principal? How much of their last payment goes towards interest? How much of their last payment goes towards principal? How much is paid in interest total over the 6 years? When will approximately half of the original value be paid off? A. It takes less than 3 years B. 3 years C. It takes more than 3 years.

D. none of the above

Month	Balance	Interest	Reduction in Principle	New Balance
1	$0.00	$0.00	#NUM!	#NUM!
2	#NUM!
3
4

Principal
APR
Number of years
Payment	#NUM!

Tips for #7: Enter the APR as a decimal value (Excel is formatted to correctly represent it as a percentage). In column B only drag cell B3 do not select B2 as part of the drag and autofill. If you copy the formulas correctly to the end of the loan, the New Balance in 'column E' will be $0 indicating the loan is paid in full.