A Mathematical View of Our World. 1 st ed. Parks, Musser, Trimpe, Maurer, and Maurer. Chapter 13. Consumer Mathematics: Buying and Saving. Section 13.1 Simple and Compound Interest. Goals Study simple interest Calculate interest Calculate future value Study compound interest
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Parks, Musser, Trimpe, Maurer, and Maurer
Buying and Saving
What is the simple interest on a $2000 loan at 8% from March 19th through August 15th in a leap year?
If you loan your friend $100 at 3% interest compounded daily, how much will she owe you at the end of 1 year?
r = 0.04, m = 12 and t = 18.
287.84 + 144.10 + 4.33 – 150.00 = 286.27
When paying off an amortized loan, the percent of the monthly payment going toward the interest will:
a. increase as time goes by.
b. decrease as time goes by.
c. remain the same every month.
$340 - $10 = $330
$340 - $6.70 = $333.30
t = 4.
r = 0.0337, and t = 10.
Use the amortization formula to determine the amount of the monthly payment for a loan of $30,000 at 5% for 3 years.
r = 0.04, and t = 3.
If you make $28,000 per year, can you afford to buy a house for $83,000 with monthly housing expenses of $650?
a. Yes, according to the low maximum guideline.
b. Yes, according to the high maximum guideline.
Suppose you have $5000 for a down payment on a house that is selling for $82,000. If the lender requires a 5% down payment for first-time homebuyers, is this house within your price range?
a. Yes b. No