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Homework 8 - one month from now Assume 30 days per month 5...

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Homework 8 1. A local credit union is advertising a car loan with an APR of 4.5%. If interest is compounded monthly, what is the equivalent annual interest rate (i.e., APY)? 2. My credit card charges 0.0425% per day on the outstanding balance. What is the APR for this credit card? What is the APY? Assume 360 days in a year. 3. My credit card charges 0.0425% per day on the outstanding balance. What is the nominal monthly interest rate? What is the effective monthly interest rate? Assume 360 days in a year. 4. Let’s say I purchase a $900 flat-screen TV and charge it to the credit card in the previous problem. If there is no grace period on new purchases, what will my credit card balance be
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Unformatted text preview: one month from now? Assume 30 days per month. 5. The Adams County (Wisconsin) Road Commission purchased a $340,000 Bomag MPH454R asphalt pavement recycler. A local bank is offering a low interest rate of 5% compounded daily to purchase the machine. If the municipality pays back the principal plus interest in one lump sum at the end of 4 years , what is the total interest to be paid? 6. If another bank offers the Adams County Road Commission a rate of 5.10% compounded semi-annually, should the municipality go with the new offer, instead?...
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