Loan Payments
1. You wish to buy a $24,500 car. The dealer offers you a 6-year loan with a 7.2 percent APR. What are the monthly payments? (Do not round intermediate calculations and round your final answer to 2 decimal places.)
payment = per month
2. How would the payment differ if you paid interest only? (Do not round intermediate calculations and round your final answer to 2 decimal places.)
payment = per month
Number of Annuity Payments
3. Joey realizes that he has charged too much on his credit card and has racked up $4,500 in debt. If he can pay $175 each month and the card charges 15 percent APR (compounded monthly), how long will it take him to pay off the debt? (Do not round intermediate calculations and round your final answer to 2 decimal places.)
Time to pay off the debt = months
Investing for Retirement
4. Monica has decided that she wants to build enough retirement wealth that, if invested at 10 percent per year, will provide her with $4,300 of monthly income for 25 years. To date, she has saved nothing, but she still has 30 years until she retires.
How much money does she need to contribute per month to reach her goal? First compute how much money she will need at retirement, then compute the monthly contribution to reach that goal. (Do not round intermediate calculations and round your final answer to 2 decimal places.)
Contribution per month =