Question

You have just been approved for a 30 year 6.0% fixed home mortgage. The monthly payment that you qualify for is $1112.10. Use the table provided to determine the price of a home that can be purchased. Round your answer to the nearest cent. / a. $183,147 c. $185,350 b. $184,789 d. $186,523

Answer 1

Answer:

$185350 is the correct answer.

Step-by-step explanation:

The formula for EMI is :

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

Lets suppose the principle amount be = p

rate or r = 6/12/100=0.005

EMI = $1112.10

Time or n = 30*12 = 360

Now, putting these values in formula,

$1112.10=\frac{p*0.005*(1.005)^{360} }{(1.005)^{360}-1 }$

$1112.10=\frac{0.005p*6.0225}{5.0225}$

$1112.10*5.0225=0.03011p$

p = $185503.89

So, the principle amount becomes $185503.89

This is closest to $185350, so this is the correct answer.