Amount of the mortgage after down payment is 160,000−160,000×0.2=128,000
Now use the formula of the present value of annuity ordinary to find the yearly payment The formula is Pv=pmt [(1-(1+r)^(-n))÷r] Pv present value 128000 PMT yearly payment? R interest rate 0.085 N time 25 years Solve the formula for PMT PMT=pv÷[(1-(1+r)^(-n))÷r] PMT= 128,000÷((1−(1+0.085)^( −25))÷(0.085)) =12,507.10 ....answer
