Ask Basic Finance Expert

problem 1: Greg has negotiated a $20,000 price on a new pick-up truck. The manufacturer is offering a $1,500 rebate or 3.9 %, three-year financing. Greg is also able to get 7 %, three-year financing at his credit union. If Greg plans to finance $18,000 over three years, should he take the rebate or the 3.9 % financing? (Show all work.)

problem 2: Judy has $2,000 for a down payment on a vehicle and she can afford monthly payments of $400. She wants to finance a vehicle over no more than 4 years. If lenders are currently offering 6 percent interest on 5-year loans, what is the maximum price Judy can pay for a vehicle?

problem 3: Your mortgage payment is $1,500 per month. Of this amount, insurance is $50, property taxes are $200, and interest is about $1,100. Assuming you have other itemized deductions that already exceed your standard deduction and that you are in the 31% marginal tax bracket, what is the reduction in your tax liability as a result of owning a home with this mortgage. (Show all work.)

problem 4: Dick and Jane (and their dog Spot) have just purchased a house and are calculating how much money they will need when the closing day rolls around. The purchase price is $200,000. They will make a 20% down payment, and they must pay 2 points on the loan. Closing costs should be 3% of the purchase price. What is the total dollar amount they will need at closing? (Show all work.)

problem 5: Christine just finished her first year of work following graduation, and she feels it is time she assess her financial situation. Her annual gross income is $45,000, and her income after taxes is $35,800. She has the following liabilities. What is Christine's debt safety ratio, and what does it say about Christine's financial situation?

2232_financial situation.jpg

problem 6: find out the finance charge and the monthly payment on a $20,000 add-on installment loan with an interest rate of 9% and a term of 5 years. (Show all work.)

problem 7: Downward Motors has offered Vicki either a $2,500 rebate or a 2%, 4-year loan on the new SUV she is purchasing for $33,000 with a $3,000 down payment. Vicki has done her homework and knows that she can get a 6%, 4-year loan at his credit union. Should Vicki take the rebate or the 2% loan from the dealer? (Show your key strokes.)

problem 8: You have inherited $250,000. You have decided that since you don't need the money currently, you should invest for the long-term. After seeking advice, you decide on an asset allocation plan that puts 10% in short-term securities, 75% in equities, and 15% in bond funds. How much money would you put in each category? (Show all work.)

problem 9: You have just bought 100 shares of ABC Corporation common stock at 70.50. The commission is find outd as 1.5% of the total value of the transaction plus $30. What commission will you be charged and how much must you pay the broker for the entire transaction? (Show all work.)

problem 10: Julie's employer has a defined benefits retirement plan which pays 3.2 percent of her last year's salary for each year of employment. Julie estimates her final salary will be $85,000 and she will have worked for 20 years. What is her expected retirement benefit? (Show all work.)

Basic Finance, Finance

  • Category:- Basic Finance
  • Reference No.:- M91871

Have any Question?


Related Questions in Basic Finance

Question utilizing the concepts learned throughout the

Question: Utilizing the concepts learned throughout the course, write a Final Paper on one of the following scenarios: • Option One: You are a consultant with 10 years experience in the health care insurance industry. A ...

Discussion your initial discussion thread is due on day 3

Discussion: Your initial discussion thread is due on Day 3 (Thursday) and you have until Day 7 (Monday) to respond to your classmates. Your grade will reflect both the quality of your initial post and the depth of your r ...

Question financial ratios analysis and comparison

Question: Financial Ratios Analysis and Comparison Paper Prior to completing this assignment, review Chapter 10 and 12 in your course text. You are a mid-level manager in a health care organization and you have been aske ...

Grant technologies needs 300000 to pay its supplier grants

Grant Technologies needs $300,000 to pay its supplier. Grant's bank is offering a 210-day simple interest loan with a quoted interest rate of 11 percent and a 20 percent compensating balance requirement. Assuming there a ...

Franks is looking at a new sausage system with an installed

Franks is looking at a new sausage system with an installed cost of $375,000. This cost will be depreciated straight-line to zero over the project's five-year life, at the end of which the sausage system can be scrapped ...

Market-value ratios garret industries has a priceearnings

(?Market-value ratios?) Garret Industries has a? price/earnings ratio of 19.46X a. If? Garret's earnings per share is ?$1.65?, what is the price per share of? Garret's stock? b. Using the price per share you found in par ...

You are planning to make annual deposits of 4440 into a

You are planning to make annual deposits of $4,440 into a retirement account that pays 9 percent interest compounded monthly. How large will your account balance be in 32 years?  (Do not round intermediate calculations a ...

One year ago you bought a put option on 125000 euros with

One year ago, you bought a put option on 125,000 euros with an expiration date of one year. You paid a premium on the put option of $.05 per unit. The exercise price was $1.36. Assume that one year ago, the spot rate of ...

Common stock versus warrant investment tom baldwin can

Common stock versus warrant investment Tom Baldwin can invest $6,300 in the common stock or the warrants of Lexington Life Insurance. The common stock is currently selling for $30 per share. Its warrants, which provide f ...

Call optionnbspcarol krebs is considering buying 100 shares

Call option  Carol Krebs is considering buying 100 shares of Sooner Products, Inc., at $62 per share. Because she has read that the firm will probably soon receive certain large orders from abroad, she expects the price ...

  • 4,153,160 Questions Asked
  • 13,132 Experts
  • 2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

Why might a bank avoid the use of interest rate swaps even

Why might a bank avoid the use of interest rate swaps, even when the institution is exposed to significant interest rate

Describe the difference between zero coupon bonds and

Describe the difference between zero coupon bonds and coupon bonds. Under what conditions will a coupon bond sell at a p

Compute the present value of an annuity of 880 per year

Compute the present value of an annuity of $ 880 per year for 16 years, given a discount rate of 6 percent per annum. As

Compute the present value of an 1150 payment made in ten

Compute the present value of an $1,150 payment made in ten years when the discount rate is 12 percent. (Do not round int

Compute the present value of an annuity of 699 per year

Compute the present value of an annuity of $ 699 per year for 19 years, given a discount rate of 6 percent per annum. As