HELP AGAIN. FINANCE PROBLUMS!

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desi43

New member
Joined
Jan 18, 2005
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6
Hey, i really need some help. i got answers for almost all the problums but am not sure if they are right. can someone please check for me and also help me out if they are wrong? thankyou so much!


1. suppose $1000 is owed on a credit card

a) at 1.5% compound interest per month. find the effective annual interest rate.

i used 1.5% / 12 and got got an answer of 1.51 %



now suppose payments made are $20 each month on a loan for first 12 months. the outstanding balance at the end of the year is $917.12


a) since interest is not charged on the first month let p=980 and n=11 in the balance of an amortization formula. what is the outstanding balance?

i did 980 (1+1.51%) ^11 and got $993.55


a) let p=980 and n=89 find the out standing balance.

i did 980 (1+1.51%)^89 and got 1112.50


c) after making 90 payments (over a period of 7 1/2 years) determine the total interest paied by subtracting your original dept from what you paid.

i was not sure if my above answer was right to answer this one.

d) what is this amount as a percentage of your original dept?

i was not sure if my above answer was right to answer this one also
 
desi43 said:
Hey, i really need some help. i got answers for almost all the problums but am not sure if they are right. can someone please check for me and also help me out if they are wrong? thankyou so much!


1. suppose $1000 is owed on a credit card

a) at 1.5% compound interest per month. find the effective annual interest rate.

i used 1.5% / 12 and got got an answer of 1.51 %
Click to expand...
What? Try \(\displaystyle 1.015^{12}\)

now suppose payments made are $20 each month on a loan for first 12 months. the outstanding balance at the end of the year is $917.12

a) since interest is not charged on the first month let p=980 and n=11 in the balance of an amortization formula. what is the outstanding balance?
Click to expand...
Why is there no interest in the first month?

i did 980 (1+1.51%) ^11 and got $993.55


a) let p=980 and n=89 find the out standing balance.

i did 980 (1+1.51%)^89 and got 1112.50


c) after making 90 payments (over a period of 7 1/2 years) determine the total interest paied by subtracting your original dept from what you paid.

i was not sure if my above answer was right to answer this one.

d) what is this amount as a percentage of your original dept?

i was not sure if my above answer was right to answer this one also
Click to expand...
Ummm...most of this makes no sense. Try one at a time. Maybe you'll learn something on the the early ones.
 
I forgot to add the problum said there is no interest in the first month.
 
Desi, from your attempted answers, you're obviously not ready for this;
what grade are you in?
Can you answer this:
if interest rate is 7% annually, how much interest will a savings
account of $3000 earn over 2 years?
 
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