Answer this real-world question
1 answer:
You might be interested in
Answer:
The month payment amount is $897.589
Interest amount is $61,566
Step-by-step explanation:
Given as :
The price of the house = $125,000
The down payment amount for house = 20% of total price
i.e The down payment amount for house = 20% × $125,000
Or, The down payment amount for house = × $125,000
Or, The down payment amount for house = $25,000
Now, Balance amount = total price - down payment
Or, Balance amount = $125,000 - $25,000
Or, Balance amount = $100,000
So, The balance amount is bring finance
The finance principal amount = p = $100,000
The rate of interest applied = r = 3.25%
The time period of mortgage = t = 15 years = 15 × 12 = 180 months
Let The Amount of mortgage after 15 years = $A
<u>From Compound Interest method</u>
Amount = Principal ×
Or, A = p ×
Or, A = $100,000 ×
Or, A = $100,000 ×
Or, A = $100,000 × 1.61566
Or, A = $161,566
So,The Amount of mortgage after 15 years = $161,566
Interest applied = Amount - principal
Or, I = $161,566 - $100,000
∴ Interest = $61,566
<u>Again</u>
The month payment amount =
i.e The month payment amount =
Or, The month payment amount = $897.589
Hence The month payment amount is $897.589 and interest amount is $61,566 . Answer