Question

Mortgage loan of $84,000.

Answer 1

Answer: $420

Step-by-step explanation:

The monthly payment has both an interest component and a principal repayment component.  

The interest component is based on the total loan amount(principal) still due at the time and the principal repayment component will be the rest of the payment.

First convert the interest rate to a monthly interest rate as the payments are done monthly:

= 6%/12

= 0.5%

Interest = Principal remaining * interest rate

= 84,000 * 0.5%

= $420