1. Ada purchased a house using a fixed rate mortgage. The annual interest rate is 6.3%
1 answer:
The monthly payment on the mortgage is option C) $2537.44
<u>Step-by-step explanation</u>:
- Principal (P): $ 295,000
- Rate (r): 6.3% = 0.063
- Number of times compounded (n): 12months
15 years = 180
- Number of years = 15
The formula is A = P(1 + r/n)^nt
⇒ A = 295000(1+0.063/180)^(18015)
⇒ A = 295000(180.063/180)^2700
⇒ A = 295000 (1.00035)^2700
⇒ A = 758854.5
Interest = Amount - Principle
⇒ 758854.5 - 295000
⇒ Interest = 463854.5
∴ The monthly payment for 15 years = 463854.5 / (1512)
The monthly payment on the mortgage = 2576.9 (approximately option C)
You might be interested in
Answer:
The correct answer is $3300 for simple interest and $3312.24 for compound interest.
Step-by-step explanation:
Income as working as a lifeguard = $3000
We deposit the money in a bank which offers 2% interest annually for a period of 5 years.
Case 1 : Calculating simple interest for the given situation.
Amount after 5 years = 3000 + 3000 × 2 × 5 × = $ ( 3000 + 300) = $3300.
Case 2 : Calculating compound interest for the given situation.
Amount after 5 years = 3000 × = $ 3312.24.
Thus the amount after 5 years amount simply is $3000 and compoundly is $3312.24