Question

A mutual fund manager wishes to purchase a property that's been valued at $1.5 m. She has $200,000 in cash to use as a deposit, and she will require a mortgage for the rest, which is to be paid monthly. The annual interest rate on the loan is 2.45% and the loan is for 25 years. Calculate the total interest payable, giving your answer in dollars to the nearest hundred dollars. Do not include commas or the dollar sign in your answer.

Answer 1

Answer:

439,802

Step-by-step explanation:

the other one was wrong

Answer 2

Answer:

The interest paid will be 440000 approx.

Step-by-step explanation:

The property value = $1,500,000

Down payment = $200,000

So, loan amount will be = $1500000-200000=1300000$ dollars

Now, EMI formula is:

$\frac{p\times r\times(1+r)^{n}}{(1+r)^{n}-1}$

We have p = 1300000

r = $2.45/12/100=0.0020417$

n = $25\times12=300$

Substituting values in formula we get:

$\frac{1300000\times0.0020417\times(1+0.0020417)^{300}}{(1+0.0020417)^{300}-1}$

= $\frac{1300000\times0.0020417\times(1.0020417)^{300}}{(1.0020417)^{300}-1}$

= $5799.38 rounded to approx $5800.

Now, he will pay $5800\times300=1740000$ dollars in 25 years

So, interest paid = $1740000-1300000=440000$ dollars

Hence, the interest paid will be 440000 approx.