Is the company claim correct

Assignment Help Financial Management

Reference no: EM131597264

Mary's credit card situation is out of control because she cannot afford to make her monthly payments. She has three credit cards with the following loan balances and APRs: Card 1, $4,700 ,20 %;

Card 2, $5,700 ,24 %; and Card 3, $3,200 ,17 %. Interest compounds monthly on all loan balances. A credit card loan consolidation company has captured Mary's attention by stating they can save Mary 26 % per month on her credit card payments. This company charges 16.5 % APR. Is the company's claim correct? Assume a 10 -year repayment period.

Mary's current minimum monthly payments are $----------. (Round to the nearest cent.)

Mary's minimum monthly payments after loan consolidation will be $ ----------. (Round to the nearest cent.)

Is the company's claim correct? Choose the correct answer below.

A. Yes because Mary's monthly credit card payments will decrease for more than 16 %.

B. No because Mary's monthly credit card payments will decrease for less than 16 %.

C. Yes because Mary's monthly credit card payments will increase for more than 16 %.

D. No because Mary's monthly credit card payments will increase for less than 16 %.

Reference no: EM131597264

Questions Cloud

What is the company current stock price : What is the company's current stock price?

Considering an investment in two different bonds : You are considering an investment in two different bonds. One bond matures in seven years and has a face value of $1,000. What is the price of each bond?

Review vision-mission statement of nonprofit organization : For this assignment, review the vision and mission statement of the nonprofit organization you're currently working with for this class.

Examine the marketing philosophy of commercial bank : Assess the marketing philosophy of Commercial Bank of Ethiopia. Which of the philosophies discussed, do you think, is adopted by the bank.

Is the company claim correct : Mary's credit card situation is out of control because she cannot afford to make her monthly payments. Is the company's claim correct?

The bank borrows in one currency and lends in other currency : the bank borrows in one currency and lends in other currency? what will its dollar profit be from speculation over the six-day period?

Automated systems for its watch component production : A company called PB is looking to buy one of two automated systems for its watch component production.

Discuss the four areas of the evolution of marketing : Identify and discuss the four areas of the evolution of marketing. Explain the difference between viral marketing, blogging and podcasting.

Calculate which alternative is the best investment : Find the ROR of each alternative. Calculate which alternative is the best investment.

User Account

All Pages