- Budgeting
- Cash Management
- Consumer and Mortgage Loans
- Introduction
- Understand How Consumer Loans Can Keep You from Achieving Your Goals
- Explain the Characteristics and Costs of Consumer Loans
- Explain the Characteristics and Costs of Mortgage Loans
- Understand How to Select the Least Expensive Sources for Consumer Loans and How to Reduce the Costs of Borrowing
- Summary
- Assignments
- Debt and Debt Reduction
- Time Value of Money 1: Present and Future Value
- Time Value of Money 2: Inflation, Real Returns, Annuities, and Amortized Loans
- Insurance 1: Basics
- Insurance 2: Life Insurance
- Insurance 3: Health, Long-term Care, and Disability Insurance
- Insurance 4: Auto, Homeowners, and Liability Insurance
- The Home Decision
- The Auto Decision
- Family 1: Money and Marriage
- Family 2: Teaching Children Financial Responsibility
- Family 3: Financing Children’s Education and Missions
- Investments A: Key Lessons of Investing
- Investments B: Key Lessons of Investing
Case Study #2 Answers
A. To solve for simple interest monthly payments, set your calculator to monthly payments, end mode:
PV = -1,000 , I = 12%, P/Y = 12, N = 24, PMT=?
PMT = $47.074
B. Total interest paid = 47.074 x 24 – 1,000 = ?
$129.76
C. To calculate the APR, it is [(interest + fees) / 2] / average amount borrowed (which changes each year as you pay it down). (See the following slide to see how to get the average amount borrowed of $540.68).
($129.76 / 2 years) / $540.68 = 12%
APR from an Excel spreadsheet
