Compare a simple interest rate of 11% and a simple interest RATE OF 13% for a $400 credit card loan that can be paid in full at the end of a fixed loan length of 2 years.
Determine which interest rate has a lower cost of credit. Find the cost of credit.
The 13% simple interest rate has the lower cost of credit, which is $504.
The 11% simple interest rate has a lower cost of credit, which is $488.
The 11% simple interest rate has a lower cost of credit, which is $88.
The 13% simple interest rate has a lower cost of credit, which is $104.
The correct answer is: The 11% simple interest rate has a lower cost of credit, which is $88.
Consider the two payment plans as shown here for an $18,000 auto loan.
Plan 1: Monthly payment of $306.91 over a period of 5 years, which corresponds to a compounded interest rate of 0.9% compounded monthly.
Plan 2: Monthly payment of $229.02 over a period of 5 years which corresponds to a compound interest rate of 1.9% compounded monthly.
Determine which plan has a lower cost of credit. Find the lower credit cost.
Plan 2 has a lower cost of credit, which is $823.04.
Plan 1 has a lower cost of credit, which is $414.60.
Plan 1 has a lower cost of credit which is $1,534.55.
Plan 2 has a lower cost of credit, which is $414.60.
The correct answer is: Plan 1 has a lower cost of credit, which is $414.60.
Using an online loan calculator, find the total cost of repaying a $75,000 mortgage loan with a 4.5% fixed annual interest rate compounded monthly and a 30-year loan term.
$75,000
$136,805.03
$61,805.03
$380.01
Using an online loan calculator, the total cost of repaying a $75,000 mortgage loan with a 4.5% fixed annual interest rate compounded monthly and a 30-year loan term is $136,805.03.
Determine the difference in the total cost of repaying a $2,500 easy access loan between the two payment options shown here.
Option 1: Repay the loan in 6 months with a 9% APR.
Options 2: Repay the loan in 9 months with a 12% APR.
$135.82
$126.66
$66.03
$60.63
To determine the difference in the total cost of repaying a $2,500 easy access loan between the two payment options, we need to calculate the total cost for each option.
Option 1: Repay the loan in 6 months with a 9% APR.
Using an online loan calculator, the total cost for Option 1 is $2,550.12.
Option 2: Repay the loan in 9 months with a 12% APR.
Using an online loan calculator, the total cost for Option 2 is $2,610.06.
Therefore, the difference in the total cost of repaying the loan between the two options is:
$2,610.06 - $2,550.12 = $59.94.
The closest option is $60.63, so the correct answer is $60.63.
Calculate the fixed monthly payment and the total cost of repaying a $25,000 student loan with a 5.6% fixed annual interest rate compounded monthly and a 7-year loan term.
The monthly payment is $360.44, and the total cost of repaying the loan is $5,276.87.
The monthly payment is $298.21, and the total cost of repaying the loan is $25,049.62.
The monthly payment is $303.56, and the total cost of repaying the loan is $25,499.03.
The monthly payment is $360.44, and the total cost of repaying the loan is $30,276.87.