SOC 202 Lecture Notes - Balloon Payment Mortgage, Cash Flow, The Monthly
Document Summary
Lo1 how to determine the future and present value of investments with multiple cash flows. Lo2 how loan payments are calculated and how to find the interest rate on a loan. Lo3 how loans are amortized or paid off. Lo4 how interest rates are quoted (and misquoted). Answers to concepts review and critical thinking questions. The basic concept of time value of money is that a dollar today is not worth the same as a dollar tomorrow. The deception is particularly irritating given that such lotteries are usually government sponsored! (lo1) if the total money is fixed, you want as much as possible as soon as possible. The team (or, more accurately, the team owner) wants just the opposite. (lo1) the better deal is the one with equal installments. Note: all end of chapter problems were solved using a spreadsheet.