Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Mia Salto wishes to determine how long it will take to repay a $12,000 loan given that the lender requires her to make annualend-of-year installment

Mia Salto wishes to determine how long it will take to repay a $12,000 loan given that the lender requires her to make annualend-of-year installment payments of $2,518.

a. If the interest rate on the loan is 12%, how long will it take for her to repay the loanfully?

b. How long will it take if the interest rate is 9%?

c. How long will it take if she has to pay 15% annualinterest?

d. Reviewing your answers in parts a, b, and c, describe the general relationship between the interest rate and the amount of time it will take Mia to repay the loan fully.

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Public Finance A Contemporary Application of Theory to Policy

Authors: David N Hyman

11th edition

9781305474253, 1285173953, 1305474252, 978-1285173955

More Books

Students also viewed these Finance questions

Question

Find the derivative of the function. y = e x-4

Answered: 1 week ago

Question

What is meant by Career Planning and development ?

Answered: 1 week ago

Question

What are Fringe Benefits ? List out some.

Answered: 1 week ago