FIN 1103-3 FIN1103-3 Individual Week 7
FIN 1103-3 Individual Week 7
1. Bridget Morrow is a sophomore at State College and is running out of money. Wanting to continue her education, Bridget is considering a student loan. Explain her options. How can she best minimize her borrowing costs and maximize her flexibility?
4. Using the simple interest method, find the monthly payments on a $ 3,000 installment loan if the funds are borrowed for 24 months at an annual interest rate of 6 percent.
5. Find the finance charges on a 6.5 percent, 18 months, single payment loan when interest is computed using the simple interest method. Find the finance charges on the same loan when interest is computed using the discount method. Determine the APR in each case.
6. Assuming that interest is the only finance charge, how much interest would be paid on a $5,000 installment loan to be repaid in 36 monthly installments of $166.10?
7. Todd Kowalski is borrowing $ 10,000 for five years at 7 percent. Payments, which are made on a monthly basis, are determined using the add- on method.