Five years ago you obtained a 25-year $200,000 mortgage loan that has an interest rate of 14.5%. You can refinance the loan with a 15-year loan that has an interest rate of 12.0%. If you refinance the first loan, you will have to pay $4,000 of loan origination fees and a 2.5% prepayment penalty on the outstanding principal balance of the original loan. Assume further that you will borrow enough to pay off the remaining principal and all costs associated with refinancing. Original Loan Info

Original Loan Amount $200,000,000
Original Interest Rate 14.5%
Original Term (years) 25
Periods 12
PMT (monthly)
NPERs already paid off
Balance outstanding after 5 years

Refinancing Load Info
Prepayment Penalty (%) 2.5%
RATE 12.0%
New Term (years) 15
Periods 12
Principal Borrowed
Loan Origination Fee $4000
Prepayment Penalty (Value)
Total Cost of loan

Required:
How much will you manage to save each month by refinancing?

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< back to assignment attempts: 1 1 keep the highest: 1 / 2 2. determining opportunity cost juanita is deciding whether to buy a suit that she wants, as well as where to buy it. three stores carry the same suit, but it is more convenient for juanita to get to some stores than others. for example, she can go to her local store, located 15 minutes away from where she works, and pay a marked-up price of $102 for the suit: store travel time each way price of a suit (minutes) (dollars per suit) local department store 15 102 across town 30 88 neighboring city 60 65 juanita makes $42 an hour at work. she has to take time off work to purchase her suit, so each hour away from work costs her $42 in lost income. assume that returning to work takes juanita the same amount of time as getting to a store and that it takes her 30 minutes to shop. as you answer the following questions, ignore the cost of gasoline and depreciation of her car when traveling. complete the following table by computing the opportunity cost of juanita's time and the total cost of shopping at each location. store opportunity cost of time price of a suit total cost (dollars) (dollars per suit) (dollars) local department store 102 across town 88 neighboring city 65 assume that juanita takes opportunity costs and the price of the suit into consideration when she shops. juanita will minimize the cost of the suit if she buys it from the . grade it now save & continue continue without saving

Jordan, inc. sells fireworks. the company’s marketing director developed the following cost of goods sold budget for april, may, june, and july. april may june july budgeted cost of goods sold $62,000 $72,000 $82,000 $88,000 jordan had a beginning inventory balance of $3,000 on april 1 and a beginning balance in accounts payable of $14,600. the company desires to maintain an ending inventory balance equal to 15 percent of the next period’s cost of goods sold. jordan makes all purchases on account. the company pays 65 percent of accounts payable in the month of purchase and the remaining 35 percent in the month following purchase. required prepare an inventory purchases budget for april, may, and june. determine the amount of ending inventory jordan will report on the end-of-quarter pro forma balance sheet. prepare a schedule of cash payments for inventory for april, may, and june. determine the balance in accounts payable jordan will report on the end-of-quarter pro forma balance sheet.