Ch 7 Case - Finance charges include interest costs and other costs These other costs include service charges credit related insurance premiums or

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Chapter 7: Financial Planning Case 1. What is perhaps the most item shown on the disclosure statement why? The most important item shown on the disclosure statement are the Annual Percentage Rate (APR) and the finance charges in dollar amount. The APR shows the percentage rate on borrowed capital and finance charges in dollar amount shows how much extra will be required to repay the loan. APR and finance charges are necessary for a customer to make a wise investment decision. 2. What is included in the finance charge?
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Unformatted text preview: Finance charges include interest costs and other costs. These other costs include: service charges, credit related insurance premiums or appraisal fees. 3. What amount will Sue receive from the bank? The amount Sue will receive from the bank is $6,000. 4. Should Sue borrow from Bank A or Bank B? Sue should borrow money from Bank A because, the total finance charges and APR is lower than what Bank B offers. Sue should definitely choose Bank A....
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This note was uploaded on 04/14/2010 for the course ACCT Act695 taught by Professor Smith during the Spring '10 term at York University.

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