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final amount should be 119,879.00, the file has all the steps and information needed.

MGF 1107: Final Project
Z. Forrest
1
Prompt
Whether or not it’s your favorite time of year, it’s hard to deny that Summer has a certain je ne
sais quoi – an air of adventure and carefree creativity that permeates the entire three-month period.
Even more difficult (some might say impossible) to deny is that you’ve been cooped up for months,
studying for a mountainous pile of lectures, quizzes, exams, and projects, and that you’re feeling like
a break is well-deserved. With feelings like these tumbling around the inside of your head, and with
the signs of the Summer months’ approach reflected in the world around you, you decide that the
time is right for you to bring Summer to your community. And what better way to do that than an
art/creative project to showcase the ideas that have been rattling around your brain?!
You manage to get semi-willing volunteers from among your friends and family, and set them
about the task of figuring out how to fund your plans. Hey, it was your idea, so you get to do the
cool parts! Your art lackeys spend days working to track down all of the possibilities, and eventually
narrow the reasonable prospects down to three options:
A. Acquire a brand-spanking new Shamazon Credit Card, and put all charges on the card – you’ll
pay it off on “your own” schedule.
B. Approach representatives at USF Federal Credit Union (FCU) and take out an installment loan
for the total amount you need.
C. Sell bonds to your community, meaning that they invest money in your project, you bring your
ideas and creativity to them in the short term, and they will expect you to eventually pay them
the face-value of the bonds they purchased.
Which option will you choose, and what will you do with the money?
1
2
Instructions
The final project consists of two parts: (Part I) A calculation portion that will walk you through the
process of determining how much you will owe under each of the three options from the previous page,
as well as a few other questions; (Part II) a brief, creative writing essay addressing the questions
listed below under (Part II) instructions. To complete the project, you will:
• Address parts I and II in their entirety and produce a cover page bearing your U#, name,
amount of money you’re borrowing, and the name of your project. (You may otherwise be
creative with the cover page!)
• Produce a PDF file that has your cover page first, then your completed parts I and II, in that
order. This will be your final project packet.
• Turn in your final project packet to me by accessing the “Final Project” assignment in Canvas
on May 7, 2020, any time between 12:00 AM and 11:59 PM (EST) and uploading your file.
Below are some instructions specific to each part, as well as instructions for the cover page.
Part I. Your work should conform to the following:
• Unless otherwise stated, you should round values to 3 decimal-places.
• For full credit, you must show each step for each question as well as the final answer for the
question. Final answers may be calculated with a calculator, MS Excel, or StatCrunch.
• Certain questions will require graphs or images: These should be generated in either MS
Excel or StatCrunch.
Part II. Your creative writing should be between 1.5 and 2.5 pages long, and address the following
topics:
• What is your creative endeavor? Since you’re choosing a creative/artistic project,
your choices are virtually unlimited. Pieces of artwork, plays, music, artistic festivals,
movies, etc. are all viable choices, but don’t allow yourself to be restricted to that list
exclusively. Feel free to be as imaginative as you want, and to include any reasons why
you chose what you chose. (Keep in mind that this is still for a class, so keep your
themes PG-13 or below!)
• What community are you making this project for? To whom are you going to be
bringing your work? Why are they the audience that you decided to pursue? What do
you think it will do for them?
• How are you going about your project? You don’t have to have every last detail,
but try to present a full and rich description of how you intend to complete your creative
endeavor. You don’t need to try to be 100% realistic in how you plan to accomplish things:
Pick a reasonable-sounding approach, and go with it.
• How much money will you be borrowing for the project, and what will you
use it for? You’ll be assigned an amount, and it should be mentioned explicitly in your
work. Describe as fully as you can the components, tools, decorations, festivities, games,
foods, etc. that you’d like to fund with that amount.
• Which of the provided options do you believe is the best choice? Why? There
isn’t a right answer here: Simply provide a full argument that displays your reasoning.
2
3
Grading
Your grade will be out of 100 points, broken down as follows between the different parts of your final
project packet:
Cover page
2%
1%
PDF file
File submitted on-time
2%
Part I 45%
Part II 50%
TOTAL 100%
When completing the project, please keep the following in mind:
• Making a cover page, putting together your final project packet as described on page 2, and
turning it in on-time via the method on page 2 is worth 5% of your grade – don’t miss out on
that 5%!
• Part I is graded with partial credit, but full credit will only given only to responses which
show full work and a final answer for the question. Remember that just like on exams, in order
to have your work qualify for partial credit it needs to show some effort and be able to be
followed by your grader.
• While we are not running an English or Writing class, your Part II grade will depend upon
the proper use of grammar and punctuation, and adherence to the length requirements from
Section 2. The Writing Center is a resource which you may use in helping ensure your work is
well-written.
• Your Part II grade will also be determined by your creativity. As your instructor and grader,
I’ll be the final judge of creativity on the project; however, an honest effort which isn’t copied
and showcases your ideas will generally score well, assuming that your punctuation, grammar
etc. are in order.
• Use of websites or programs other than MS Excel or StatCrunch will meet with an automatic
deduction of 5% from your final project grade – do not use any programs or websites
apart from MS Excel or StatCrunch.
You are expected to know the rules and guidelines for this final project, as well as for the course
in general. If you are unsure of anything regarding this final project, first consult this document and
the course syllabus as you attempt to answer your question. If you still have questions after taking
avail of these resources, it is your responsibility to consult with me prior to the deadline for this final
project. Failure to understand the rules and guideline given above is not an acceptable excuse for
failing to meet those rules and guidelines.
3
4
Formula Sheet
1. Simple interest formulas
I = P × r × t (Interest only)
F = P × (1 + r × t) (Interest plus principal)
(1)
2. Formulas for credit card statements
PIR = r ×
31
(PIR over period of 31 days)
365
M1 = P × 0.01 + P × PIR
= 1% of P + one month’s interest
(2)
M2 = P × 0.015
= 1.5% of P
Monthly Payment = MP = max{M1 , M2 }
= The larger of the two amounts M1 and M2
3. Amortization formula
"
(r/12) × (1 + r/12)12t
M =A×
(1 + r/12)12t − 1
#
Total Payment = TP = M × 12t
= Monthly payments × number of payments
(3)
Total Interest = TI = TP − P
= Total Payments − Principal
In the formulas above: • P refers to the principal, which (unless otherwise stated) is your assigned
balance; • A is a “dummy variable” that stands in for either P or P/2 (see problems in Section 5.2);
• t refers to the term in years; • r is the APR, represented as a decimal, and is calculated by taking
the APR and dividing it by 100. (e.g. If APR is 3.21%, r = 3.21/100 = 0.0321.) Recall that per
Section 2, you should round all values to 3 decimal places unless otherwise stated .
4
5
Part I
The following problems guide you through calculations related to the options presented in Section 1.
Please reference Sections 2 and 4 as needed.
5.1
Option A Calculations
You know that your Shamazon credit card carries an APR of 31.45%, and that there is a minimum
payment you may make each month. You decide that you should know how long it will take to
pay back the amount you’ve borrowed, and how much you’ll end up paying in interest. Complete
the following problems to find the desired information – show all of your your work for full
credit!
Problem 1. Using the Formula Sheet, calculate your Periodic Interest Rate (PIR). (Worth 2
points.)
Problem 2. According to your credit card agreement, your minimum monthly payment toward your
balance is one of two amounts that we will label M1 and M2 . Calculate them in the parts below.
Find M1 . Using your Formula Sheet, calculate M1 . (Worth 4 points.)
Find M2 . Now calculate M2 . (Worth 4 points.)
Find MP. Now calculate the monthly payment, rounding to 2 decimal-places. Recall from the Formula
Sheet that MP is found by comparing M1 and M2 , and choosing the larger amount. (Worth
2 points.)
5
Problem 3. Take your assigned balance P , your APR of 31.45%, and the minimum payment which
you just calculated, and put them into either MS Excel’s Credit card payoff calculator or StatCrunch’s
Finance calculator.
Part I. First record the number of years until payoff and the amount of interest that you’ll pay over
that term. (Worth 2 points.)
Part II. Now print out a copy of your results and include it into your final project packet. (Tell me
which page number to find it on for 1% bonus credit!) (Worth 1 point+1%.)
6
5.2
Option B Calculations
Your team identifies a representative at USF FCU who is more than happy to help you set up an
installment loan: They inform you that you’ll by making monthly payments based upon one of two
plans:
Plan 1. You borrow your assigned balance P for a term of 6 years at an APR of 8.17%.
Plan 2. You borrow P right away, and owe no money until 1 year from now. At the end of 1 year, you
must pay back one half of P immediately, and then will pay the remaining half of P off
over a term of 10 years with an APR of 4.23%.
If you decide to go with Option B, which of these two plans is the best one? Complete the
problems below to determine the answer – show all of your work for full credit!
Problem 4. Begin by evaluating Plan 1 in the steps below.
Find M. Calculate the monthly payment M for this plan using your assigned balance P , the formula
sheet, and the information above, rounding to 2 decimal-places. (Worth 3 points.)
7
Find TP. Using the previous part of this exercise and your formula sheet, calculate the total payment
you will make over the course of the loan. (Worth 3 points.)
Find TI. Finally, calculate the Total Interest paid under Plan 1. (Worth 1 point.)
Problem 5. Now we evaluate Plan 2. Complete the steps below.
Find P/2. Calculate half of your assigned balance P . (Worth 1 point.)
Find M. Now calculate your monthly payments using P/2, the formula sheet, and the information above
for Plan 2, rounding to 2 decimal-places. (Worth 3 points.)
8
Find TP. Calculate the Total Payment made on the loan. Do not include the down-payment of
P/2! (Worth 3 points.)
Find TI. Calculate Total Interest paid on the loan of P/2 using TP above and the formula sheet. (Worth
1 point.)
Problem 6 (Bonus). In your own words, explain which of the two plans is better for you as the
borrower, and why. (Worth 1%.)
9
5.3
Option C Calculations
Your art lackeys are a little tired of doing your bidding for no pay, and decide to keep things simple:
They say that they will offer bonds using simple interest at an APR of 5.91% for a term of 13 years.
You wonder: How much interest will be owed on the bonds?; how much money will have to be
repaid?; how does this option compare to Options A & B? Use the problems below to answer these
questions – show complete work for full credit!
Problem 7. Calculate the total amount of money that will be owed, including your assigned balance
P , rounding to 2 decimal-places. (Worth 3 points.)
Problem 8. Now calculate the interest that will be owed, rounding to 2 decimal-places. (Worth 3
points.)
Problem 9. Compare the interest calculated in Problem 7 to the interest calculated in Problem 3,
Part I. Which of Options A and C produces the least interest? (Worth 3 points.)
Problem 10. Compare the interest calculated in Problem 7 to the interest calculated in Problem 4,
“Find TI”. Which of Options B (Plan 1) and C produces the least interest? (Worth 3 points.)
Problem 11. Compare the interest calculated in Problem 7 to the interest calculated in Problem 5,
“Find TI”. Which of Options B (Plan 2) and C produces the least interest?
10
6
Part II
Complete your creative essay according to the rules and guidelines laid out in Section 2, as well as
the following:
• Use 12 point font in Times New Roman style.
• Use single spacing between lines.
• Use 1” margins.
When your essay is done, you may include it in your PDF file behind this page in your final
project packet. Remember while writing that your goal is to answer the questions in Section 2; to
paint a clear and coherent picture for me as your reader; and to put your creativity on display. Apart
from these guidelines, have fun! (Worth 50 points.)
Have any comments or suggestions for the course? Let me know here! Thanks for participating
in our course, and have a good Summer!
11
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