1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
Vikki [24]
3 years ago
9

ou are ready to buy a house, and you have $40,000 for a down payment and closing costs. Closing costs are estimated to be 6% of

the loan value. You have an annual salary of $60,000, and the bank is willing to allow your monthly mortgage payment to be equal to 28% of your monthly income. The interest rate on the loan is 4% per year with monthly compounding for a 15-year fixed rate loan. What is the down payment for the house? (Choose the nearest value)
Business
1 answer:
goldenfox [79]3 years ago
8 0

Answer:

$21,524.06

Explanation:

For computing the down payment for the house we need to do the following calculations

Monthly income is

= Annual salary ÷ total number of months in a year

= $60,000 ÷ 12 months

= $5,000

Now the maximum payment is

= 28% ×  $5,000

= $1,400

And, the present value is

= Maximum payment × {1 - 1 ÷ (1 + 0.003)^360} ÷ 0.003

= $307,932.33

The 4% is annual rate and monthly rate is 0.003 and we assume the total number of days in a year is 360 days

Now the closing cost is

= $307, 932.33 × 6%

= $18,475.94

Finally the down payment for the house is

= $40,000 - $18,475.94

= $21,524.06

You might be interested in
What is the range of useful life estimates that Tesla provides for office furniture, machinery and equipment in the 2013 10-K?a.
MAXImum [283]

Answer:

The correct answer is letter "B": 3 to 12 years.

Explanation:

American car maker Tesla, Inc. specializes in manufacturing electric-fueled autonomous driving vehicles. Founder and Chief Executive Officer (<em>CEO</em>) Elon Musk is also the chief engineer and designer for most revolutionary Tesla car models. When it comes to its 2013 10-K United States Securities and Exchange Commission form, Tesla submitted a <em>3 to 12 years estimated depreciation for office furniture, machinery and equipment, 3 years for computer equipment and software, </em>and <em>30 years for building and building improvements.</em>

3 0
3 years ago
Combined communications is a new firm in a rapidly growing industry. the company is planning on increasing its annual dividend b
frozen [14]

The annual Dividend (D0) = $1.10

D1 = $1.10 * (1+0.21)^1 = $1.33

D2 = $1.10* (1+0.21)^2 = $1.61

D3 = $1.10* (1+0.21)^3 = $1.95

D4 = $1.10 * (1+0.21)^4 = $2.36

D5 = $1.10*(1+0.05) = $2.48

Now the price of the stock at the end of the fourth year (P4) = $2.48/(0.085-0.05)

P4 = $2.48 / (0.035)

P4 = $70.85

Now the Price of the stock (P0) = $1.33/(1+0.085) + $1.61/(1+0.085)^2 +$1.95/(1+0.085)^3 + $2.36/(1+0.085)^4 + $70.86/(1+0.085)^4

Price of the stock (P0) = $1.23 +$1.37 + $1.53 + $1.70 + $51.13

Price of the stock (P0) = $56.86

Therefore the correct option is d, $56.86

3 0
3 years ago
A bond has a par value of $1,000, a time to maturity of 15 years, and a coupon rate of 7.90% with interest paid annually. If the
Effectus [21]

Answer:

$5.97

Explanation:

In order to determine the capital gain of the bond in a year's time,it is first first of all important to calculate the yield to maturity on the bond which is arrived at by applying the rate formula in excel as follows:

=rate(nper,pmt,-pv,fv)

nper is the number of coupon interest the bond would pay over its entire life of 15 years which is 15

pmt is the annual interest,7.9%*$1000=$79

pv is the current market price of the bond which is $790

fv is the value of $1000

=rate(15,79,-790,1000)=10.79%

Afterwards,the price of the bond in one year' time can then be calculated:

=-pv(rate,nper,pmt,fv)

The variables in the formula are as above except for nper which would reduce by 1 in a year's time

=-pv(10.79%,14,79,1000)

pv=$ 795.97  

Hence the capital gain=price now-price one year ago/price one year ago

price now is $795.97  

price one year ago was $790

Capital gain=$795.97-$790=$5.97

Capital gain %= ($795.97-$790)/$790=0.76%

8 0
3 years ago
The newly formed nation remained financially solvent through the first decade of its existence (1790s). Choose ONE of the follow
tresset_1 [31]

Answer:

Establishment of the national bank

- Eventually issued paper money, handled tax receipts and other government funds.

Explanation:

The adoption of Hamilton's debt plan impacted financial solvency the most because in this plan Hamilton proposed to pay off the foreign debt and to issue new bonds to cover the old ones. He also proposed that the federal government would assume all state debt, giving creditors an incentive to support the new government and he proposed a National Bank.

7 0
3 years ago
The managers of Danestump, a hardware manufacturing company, are expected to follow standing plans before approving long leaves
Hitman42 [59]

Answer: Procedures

Explanation:

From the given case/scenario, we can state that the standing plan can be referred to as <em>procedures</em>.  A procedure is referred to as a document or act that is written in order to support a policy. It is mostly designed in order to describe where,who, what, when, and why through means of building corporate accountability in inclination to implementation of the policy.

8 0
3 years ago
Other questions:
  • A company's sales forecast would likely consider all of the following factors except: advertising and pricing policies. top mana
    6·2 answers
  • What was the nickname of the person who replaced Don Meredith during the 1974 pre-season?
    13·2 answers
  • A production function for which proportional changes in all inputs leads to a more-than-proportional change in output is said to
    13·1 answer
  • Is when manufacturers direct their promotional efforts toward channel partners to convince them to order and stock products?
    11·1 answer
  • In recent years, the question of the lack of appropriate ethical behavior has been brought most strongly to the American public
    15·1 answer
  • Carmelita Inc., has the following information available: COST FROM BEGINNING INVENTORY direct materials $2,500 Conversion cost $
    14·1 answer
  • Differentiation refers to:
    15·1 answer
  • What is a contingent beneficiary on a life insurance policy
    13·1 answer
  • The money being made in a company. A. Obsolesce B. Solvency C. Revenue D. Debt
    6·2 answers
  • The children slept well ____________________ the noise.
    7·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!