Answer:
The monthly payments will be $464.44
Explanation:
in this problem we are given the present value of the annuity or house which is $60000 - $20000 = $40000 we subtract because the $20000 will be paid as a lumpsum. this will be denoted by Pv.
we are given the period n for this mortgage repayment which is 10 years but its stated that this individual will pay monthly so the period of payments n is 10 x 12 =120 payments will be done.
the interest rate is also given as 7%which is not adjusted over the periodic payments so i is 7%/12 thereafter we find the monthly payments which will be denoted by C in the present value formula :
then we substitute the above mentioned values
$40000=C[(1-(1+(7%/12))^-120)/(7%/12)] then we divide both sides by the value that multiplies C to solve for C the monthly payments.
$40000/[(1-(1+(7%/12))^-120)/(7%/12)] = C, then compute on calculator.
therefore C the montly payments is $464.44
we use the present value annuity as it is a series of periodic payments in the futer for a value given now.
Answer: $19,800
Explanation;
The Monopolist will maximize output at the point where Marginal Revenue equals Marginal Cost because at this point all resources are being fully utilized.
Total Cost = Average Total Cost * Quantity produced
At the point where MR=MC, the quantity produced is 1,100 units.
The Average Total Cost tallying with this is $18 per unit.
Total Cost = 18 * 1,100
= $19,800
