You have decided to buy a new home and the bank offers you a 10 year fixed loan at 5.0% on a balance of $275,325. Determine the
monthly payments.
a. $2,921.20 c. $1,460.60
b. $137,500 d. $243.43
a. $2,921.20 c. $1,460.60
b. $137,500 d. $243.43
1 answer:
Rate = 5 /1,200 =
<span>
<span>
<span>
0.0041666667
</span>
</span>
</span>
Monthly payment = (rate + (rate / [(1+rate)^months -1])) * principal
Monthly payment = <span> <span> <span> 0.0041666667 </span> </span> </span> + ( <span> <span> <span> 0.0041666667 </span> </span> </span> / <span>((1.0041666667^120)-1</span>) * principal
Monthly payment = <span> <span> 0.0041666667 </span> </span> + ( <span> <span> 0.0041666667 </span> /</span> <span><span><span>0.6470094977 </span> </span> </span> ) * principal
Monthly payment = (<span>0.0041666667 +</span><span> </span> <span> <span> <span> 0.0064398849 </span> </span> </span> <span><span> </span> </span> <span><span><span>) * 275,325 </span>
</span> </span> <span>
</span> Monthly payment = <span> <span> <span> 0.0106065515 </span> </span> </span> <span> * 275,325
</span>Monthly payment = <span><span><span>2,920.2</span></span></span>5
Monthly payment = (rate + (rate / [(1+rate)^months -1])) * principal
Monthly payment = <span> <span> <span> 0.0041666667 </span> </span> </span> + ( <span> <span> <span> 0.0041666667 </span> </span> </span> / <span>((1.0041666667^120)-1</span>) * principal
Monthly payment = <span> <span> 0.0041666667 </span> </span> + ( <span> <span> 0.0041666667 </span> /</span> <span><span><span>0.6470094977 </span> </span> </span> ) * principal
Monthly payment = (<span>0.0041666667 +</span><span> </span> <span> <span> <span> 0.0064398849 </span> </span> </span> <span><span> </span> </span> <span><span><span>) * 275,325 </span>
</span> </span> <span>
</span> Monthly payment = <span> <span> <span> 0.0106065515 </span> </span> </span> <span> * 275,325
</span>Monthly payment = <span><span><span>2,920.2</span></span></span>5
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