Question

You find that the going rate for a home mortgage with a term of 30 years is 5% APR. The lending agency says that based on your income, your monthly payment can be at most $750 . How much can you borrow?

Answer 1

Using
A=monthly payment
P=amount borrowed (present value)
i=5%/12 per month (period)
n=30*12 months (months)

Then
$P=\frac{A*((1+i)^n-1)}{i*(1+i)^n}$
Substitute values
$P=\frac{750*((1+.05/12)^{360}-1)}{.05/12*(1+.05/12)^{360}}$
$=\frac{750*((1+.05/12)^{360}-1)}{.05/12*(1+.05/12)^{360}}$
$=139711.21$  to the nearest cent