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AMDM – Loans Unit ReviewName: ____________________VocabularyA _______________ is something that is borrowed, usually money that is expected to be paid back with interest.A _____________________________ is a loan that you repay with one payment after a specified period of time.The ______________ of a loan is the amount of time for which the loan is granted._____________________ is calculated by basing the time of the loan on a 360-day year.Unlike a single payment loan, an __________________________ is a type of loan you repay in several equal payments over a specified period of time.The ___________________ is the amount of the loan you borrowed and what you have to pay back along with interest.Single Payment LoansAmy’s bank granted her a $10,000 single-payment loan for 200 days at 7 percent ordinary interest. At the end of the loan term, how much interest will she owe?Sunita’s bank agreed to lend her $7800 for 150 days at a 7.5% exact interest rate. If this is a single-payment loan, how much interest will she owe?Marcus wants to purchase new computers for his office staff. The bank grants him a single-payment loan of $22,000 for 182 days at 7.75% exact interest. What is the maturity value of his loan?Installment LoansKayla would like to add a $10,000 sunroom to her home. She finances the addition through her bank, making a 25 percent down payment and paying the rest through the bank’s installment plan. What amount does Kayla finance?Alex wants to have a new well put in on his property. The bank granted him a loan of $3200, requiring 20% down payment. What amount does Alex finance?Jennifer wants to purchase new televisions for her restaurant. The bank grants her a loan for $22,000, requiring a down payment of 20%. What amount does Jennifer finance?Simple Interest Installment LoansUse the table below to help answer the following questions about Simple Interest Installment LoansZach received an installment loan of $10,000. The APR is 12 percent and the loan is to be repaid in 48 monthly installments. What is the finance charge on the loan?Derrick received an installment loan in the amount of $7800. The APR is 10 percent and the loan is to be paid off over 30 monthly installments. What is the total amount Derrick will have to repay?Sergio was granted a loan for $20,000 with an APR of 10%. He agrees to a down payment of 20% and will repay the loan over 24 months. What amount will Sergio have to repay?Allocation of Monthly Payments for Installment LoansElle wanted to renovate her bathroom by taking out a $10,000 loan. The loan was for 48-months at 10% APR. Her monthly payment is $254. What are the interest and payment to principal for the first payment?Eric needs to install a new roof for his house. He takes out a $7800 loan at 12% APR for 36 months. If his monthly payment is $258.96, what is the new balance after the first payment?Oscar borrowed $2400. The interest rate is 12% for 12 months. The monthly payment is $213.12. The balance of the loan after four payments is $1632.10. What is the interest for the fifth payment?Paying Off Simple Interest Installment LoansWill took out a simple interest loan of $6000 at 10% interest for 24 months. After 4 payments, the balance is $5081.23. She pays off the loan when the next payment is due. What is the interest? What is the final payment?Cheryl took out a simple interest loan of $1800 for home repairs. The loan is for 12 months at 10% interest. After 8 months, the balance is $620.26. She pays off the loan when the next payment is due. What is the final payment?Scott took out a simple interest loan of $3600 at 18% for 12 months. After 6 payments, the balance 1879.90. He pays off the loan when the next payment is due. What is the interest? What is the final payment?Determining APRUse the following table to help determine APR.Herb obtained an installment loan of $6800 to pay his college tuition. The finance charge was $19.32. He agreed to repay the loan in 6 monthly payments. What is the APR?Webster obtained an installment loan of $300. The finance charge was $9.96. He agreed to repay the loan in 6 months. What is the APR?Helen obtained an installment loan for $1000. The finance charge was $33.10. She agreed to repay the loan in 6 months. What is the APR?Refund of Finance ChargeUse the table below to help determine the Refund of Finance ChargesCarlos had a 15-month installment loan that he repaid in 6 months. The total finance charge was $439.44. How much was his refund?Antonio took a 12-month installment loan to help pay for his new washer. The total finance charge was $49.96. He repaid the loan in 4 months. How much was his refund?Chloe took out a 15 month installment loan. The total finance charge was $224.50. She repaid the loan in 6 months. What is her refund? ................
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