How lenders determine what interest rate to charge you

Assignment Help Business Economics
Reference no: EM13151708

Your FICO score makes a big difference in how lenders determine what interest rate to charge you. Consider the situation faced by Edward and Jorge. Edward has a fairly poor FICO score of 660 and , as a result pays 18% APR on the unpaid balance of his credit card. Jorge has a FICO score of 740 and pays only 7.3% APR on the unpaid balance of his credit card. If both persons carry an average balance of $3000 on their credit cards for 3 years, how much more money will Edward repay compared with what Jorge owes? Assume monthly compounding of interest.

Reference no: EM13151708

Questions Cloud

List characteristics of life in the order : List characteristics of life in the order you think is the most appropriate-from the most important to the least important. Explain why?
Compute the kg mixture from the mixer : calculate the kg mix- ture from the mixer, kg water evaporated, and kg jam produced.
What would be the long run price and quantity : What would be the long run price and quantity for this firm in a competitive market and in the long run how many firms are in the industry?
What will happen to the value of the dollar : If the American auto companies make a breakthroufh in automobile technology and are able to produce a car that gets 70 miles to the gallon, what will happen to the value of the dollar? Use the demand-supply model of the dollar to explain.
How lenders determine what interest rate to charge you : Your FICO score makes a big difference in how lenders determine what interest rate to charge you. Consider the situation faced by Edward and Jorge.
What is a hierarchy : What is a hierarchy? Are complex things built from simple parts? Give examples from everyday life.
Equal total payments of accrued interest : American Eagle borrows $90,000 cash by signing a four-year, 5% installment note. The note requires four equal total payments of accrued interest and principal on December 31 of each year from 2009?
Why scientific method is used in medicine : Why scientific method is used in medicine? What characteristic or property of experimental design is the most crucial for medical research?
Compute the kgh of wet cake feed needed to produce : Calculate the kg/h of wet cake feed needed to produce 1000 kg/h of "dry" ?sh cake product.

Reviews

Write a Review

Business Economics Questions & Answers

  What distinguishes public goods from private goods

What are external costs associated with cellular phone usage in automobiles. external benefits. What is difference between private and social costs. What distinguishes public goods from private goods.

  Explain these changes using shifts in demand and supply

the price to BBB-rated companies rose from 37.5 basis points in 1998 to approximately 129 basis points in 2002. This is a 244% increase in the price or spread. Explain these changes using shifts in demand and/or supply.

  A few years ago, a construction manager earning

A few years ago, a construction manager earning $70,000/ year working for a regional home builder decided to open his own home building company.

  Illustrate economic profits made by a competitive industry

How could you graphically illustrate economic profits made by a perfectly competitive industry, a monopolist industry and a monopolistic competitive industry.

  Elucidate how do you expect the demand

Elucidate how do you expect the demand and supply of the good or service to change in the next year. Support your answer.

  Role of differentiation in the market

Elucidate the role of differentiation in the market for pizza. Then apply the feedback critique to the role of differentiation in the industry.

  What do you need to do to handle crisis

What do you need to do to handle crisis. SLook at mistaken assumptions described. Why do such assumptions arise, and what can be done to overcome se biases.

  What will this price reduction necessarily lead

What can you say about the price elasticity of demand for DVD players. What will this price reduction necessarily lead to an increase in profits for DVD player manufacturers.

  What should honda and toyota do to manage

What should Honda and Toyota do to manage this short term average price increase.

  List out at least one policy action that the federal reserve

List out at least one policy action that the Federal Reserve has taken to confirm that direction. Explain the effects of monetary policies on the economy's production and employment.

  Use a randomization test

Provide an appropriately labeled boxplot of the data below and use a randomization test to examine whether the null hypothesis holds that male and female turtles have the same mean serum cholesterol.

  Does a persistent balance of payment deficits

Does a persistent balance of payment deficits result in a pressure to devaluate the currency.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd