Assignment Task:

Question 1- sheet 1

Today, Malorie takes out a 20-year loan of $200,000, with a fixed interest rate of 3.7% per annum compounding monthly for the first 3 years. Afterwards, the loan will revert to the market interest rate.

Malorie will make monthly repayments over the next 20 years, the first of which is exactly one month from today. The bank calculates her current monthly repayments assuming the fixed interest rate of 3.7% will stay the same over the coming 20 years.

  1. Calculate the size of the repayment that the bank requires Malorie to make at the end of the first month.

Today, Malorie takes out a 20-year loan of $200,000, with a fixed interest rate of 3.7% per annum compounding monthly for the first 3 years. Afterwards, the loan will revert to the market interest rate.

Malorie will make monthly repayments over the next 20 years, the first of which is exactly one month from today. The bank calculates her current monthly repayments assuming the fixed interest rate of 3.7% will stay the same over the coming 20 years.

(b) Calculate the loan outstanding at the end of the fixed interest period (i.e. after 3 years).

Today, Malorie takes out a 20-year loan of $200,000, with a fixed interest rate of 3.7% per annum compounding monthly for the first 3 years. Afterwards, the loan will revert to the market interest rate.

Malorie will make monthly repayments over the next 20 years, the first of which is exactly one month from today. The bank calculates her current monthly repayments assuming the fixed interest rate of 3.7% will stay the same over the coming 20 years.

(c) Calculate the total interest Malorie pays over this fixed interest period.

Today, Malorie takes out a 20-year loan of $200,000, with a fixed interest rate of 3.7% per annum compounding monthly for the first 3 years. Afterwards, the loan will revert to the market interest rate.

Malorie will make monthly repayments over the next 20 years, the first of which is exactly one month from today. The bank calculates her current monthly repayments assuming the fixed interest rate of 3.7% will stay the same over the coming 20 years.

(d) After the fixed interest period, the market interest rate becomes 4.7% per annum effective. Assuming the interest rate stays at this new level for the remainder of the term of the loan, calculate the new monthly instalment.

Question 2: sheet 2

Burt deposits $10,000 into a bank account today. The account earns 4% per annum compounding daily for the first 3 years, then 4.5% per annum compounded quarterly thereafter. No further deposits or withdrawals will be made.

For this question, assume all months are of equal length and ignore leap years.

(a) Calculate the account balance six months from today.

Burt deposits $10,000 into a bank account today. The account earns 4% per annum compounding daily for the first 3 years, then 4.5% per annum compounded quarterly thereafter. No further deposits or withdrawals will be made.

For this question, assume all months are of equal length and ignore leap years.

(b) Calculate the account balance 3 years from today.

Burt deposits $10,000 into a bank account today. The account earns 4% per annum compounding daily for the first 3 years, then 4.5% per annum compounded quarterly thereafter. No further deposits or withdrawals will be made.

For this question, assume all months are of equal length and ignore leap years.

c) Calculate the account balance 3.5 years from today.

Burt deposits $10,000 into a bank account today. The account earns 4% per annum compounding daily for the first 3 years, then 4.5% per annum compounded quarterly thereafter. No further deposits or withdrawals will be made.

For this question, assume all months are of equal length and ignore leap years.

(d) Calculate the account balance 10 years from today.

Question 3- sheet 3 

A loan of $100,000 is made today. The borrower will make equal repayments of $1271 per month with the first payment being exactly one month from today. The interest being charged on this loan is constant (but unknown).

For the following two scenarios, calculate the interest rate being charged on this loan, expressed as a nominal annual rate compounding monthly. Give your answer as a percentage to 2 decimal places.

a)The loan is fully repaid exactly after 180 monthly repayments, i.e., the loan outstanding immediately after 180 repayments is exactly 0.

A loan of $100,000 is made today. The borrower will make equal repayments of $1271 per month with the first payment being exactly one month from today. The interest being charged on this loan is constant (but unknown).

For the following two scenarios, calculate the interest rate being charged on this loan, expressed as a nominal annual rate compounding monthly. Give your answer as a percentage to 2 decimal places.

(b) The term of the loan is unknown but it is known that the loan outstanding 2 years later equals to $77993.
 

This Accounting and Finance Assignment has been solved by our Accounting and Finance Experts at onlineassignmentbank. Our Assignment Writing Experts are efficient to provide a fresh solution to this question. We are serving more than 10000+ Students in Australia, UK & US by helping them to score HD in their academics. Our Experts are well trained to follow all marking rubrics & referencing style.

Be it a used or new solution, the quality of the work submitted by our assignment experts remains unhampered. You may continue to expect the same or even better quality with the used and new assignment solution files respectively. There’s one thing to be noticed that you could choose one between the two and acquire an HD either way. You could choose a new assignment solution file to get yourself an exclusive, plagiarism (with free Turnitin file), expert quality assignment or order an old solution file that was considered worthy of the highest distinction.

  • Uploaded By : admin
  • Posted on : April 23rd, 2019
  • Downloads : 0

Whatsapp Tap to ChatGet instant assistance