Business and Finance

timer Asked: Aug 24th, 2014
account_balance_wallet $5

Question Description


offer 48 mo. loans at 4.2% compounded monthly to applicants with good credit ratings.You have a good credit rating & afford monthly payments of $459.00, how much can you borrow? What is the total interest you will pay for this loan? round 2 dec

Tutor Answer

School: UIUC

No of months =48

Rate =0.042/12 =.0035

Monthly payment = 459

The present value of such stream of payments = 20248.22

Hence You can borrow $20248.22 i.e $20,248

The total payment in 48 months = 48*459=22032

Total Principal =20248

Total Interest = 22032-20248=1784

Answer : amount that can be borrowed = $20,248

Total Interest =$1784 ( more exactly $1783.78)

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Tutor went the extra mile to help me with this essay. Citations were a bit shaky but I appreciated how well he handled APA styles and how ok he was to change them even though I didnt specify. Got a B+ which is believable and acceptable.

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