Understanding Loans with a Graphing Calculator

This video tutorial demonstrates how to use the TI83 or 84 graphing calculator to understand loan calculations. It covers how to calculate car and home loan affordability, and the impact of interest rates on monthly payments. The tutorial also explores refinancing a home loan to reduce monthly payments, emphasizing the importance of understanding loan terms before making financial decisions.

What is the primary purpose of using the TI83 or 84 graphing calculator in the context of loans?

• To send emails

• To browse the internet

• To calculate loan affordability and terms

• To play games

When using the calculator's finance application, what does 'N' represent?

• Monthly payment

• Total number of compounds for the loan

• Loan amount

• Interest rate

If you can afford a monthly payment of $200, what is the approximate loan amount you can afford at 5.9% interest for 5 years?

• $5,000

• $10,370

• $15,000

• $20,000

How does a decrease in interest rate from 5.9% to 1.9% affect the monthly payment for a car loan?

• Has no effect

• Decreases the payment

• Increases the payment

• Doubles the payment

What is the typical duration of a home loan?

• 5 years

• 30 years

• 10 years

• 15 years

If you have saved $10,000 for a down payment, what is the maximum home price you can afford with a loan amount of $177,000?

• $167,000

• $177,000

• $187,000

• $197,000

What is the effect on monthly payments if you purchase a home for $150,000 instead of maxing out your loan amount?

• Payments increase

• Payments decrease

• Payments stay the same

• Payments double

What additional costs should be considered when purchasing a home?

• None, only the interest rate matters

• Just the down payment

• Only the loan amount

• Closing costs, insurance, taxes, and HOA fees

What is the new monthly payment if you refinance a $235,000 home loan at 4.25% interest?

• $1,500

• $1,173.28

• $1,000

• $1,300

What is a potential downside of refinancing a loan to a lower interest rate?

• Longer loan term

• No savings

• Higher monthly payments

• Increased interest rate