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bogdanovich [222]
3 years ago
9

You need a 30-year, fixed-rate mortgage to buy a new home for $280,000. Your mortgage bank will lend you the money at an APR of

5.75 percent for this 360-month loan. However, you can afford monthly payments of only $1,200, so you offer to pay off any remaining loan balance at the end of the loan in the form of a single balloon payment. How large will this balloon payment have to be for you to keep your monthly payments at $1,200
Business
1 answer:
SashulF [63]3 years ago
7 0

Answer: $‭415,688‬

Explanation:

First find the future value of paying $1,200 every month for 360 months.

This is the future value of an annuity:

= Payment * ([1 + interest) ^ no. of periods - 1) / interest

Use periodic interest = 5.75%/ 12

30 years * 12 = 360

= 1,200 * ( ( 1 + 5.75%/12)³⁶⁰ - 1) / 5.75% / 12

= $1,149,357.14

Future value of the loan amount is:

= 280,000 * (1 + 5.75% / 12) ³⁶⁰

= $1,565,045.14

Ballon Payment = 1,565,045.14 - 1,149,357.14

= $‭415,688‬

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suppose the real rate is 3.4 percent and the inflation rate is 5 percent. what rate would you expect to see on a treasury bill?
Ghella [55]

the rate expected on the treasury bill is 8.57%. enter answer as a percent rounded to 2 decimal places.

The real rate is 2.1 percent

The inflation rate is 3.4 percent

To find the rate which is to be expected on a treasury bill we have to apply fisher's equation

1+R= (1+r)(1+h)

Therefore, the rate on the treasury bill can be calculated as follows

1+R= (1+r)(1+h)

r= 3.4%

= 3.4/100

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h= 5%

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A Treasury invoice (T-invoice) is a brief-term debt obligation backed via the U.S. Treasury Department with an adulthood of one year or less. Treasury bills are generally bought in denominations of $1,000 even as a few can attain a denomination of $five million.

let's say an investor purchases a par price of $1,000 T-bill with an aggressive bid of $950. whilst the T-invoice matures, the investor is paid $1,000, thereby income $50 in interest on the funding.

U.S. Treasury bills are auctioned on a regular schedule. individuals should purchase T-payments from the government using the TreasuryDirect internet site. it is free to register, and it'll function like a brokerage account that holds your bonds. in addition to bidding on new troubles, You also can install reinvestments into securities of an equal type and time period. as instance, you can use the proceeds from a maturing fifty-two-week invoice to shopping for some other fifty-two-week invoice. sure brokerage corporations can also permit buying and selling in U.S. Treasuries.

To learn more about treasury bills visit here:

brainly.com/question/17204626

#SPJ4

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1 year ago
Which theorist argues that members of a class are grouped by their value in the commercial marketplace?
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4 0
3 years ago
You buy a 6% coupon $1,000 par T-bond 59 days after the last coupon payment. Settlement occurs in two days. You become the owner
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Answer:

dirty price: 1,225.39

Explanation:

When we purchase the bond, we are paying the bond and the accrued interest

<em>bond price:</em> 1,000 x 120.59375/100 = 1,205.9375‬ = 1,205.94

accrued interest at purchase:

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1,000 par value x 6% x 59/(59+2+121) =

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4 0
3 years ago
The Silver Center (TSC) produces cups and platters. TSC purchases silver and other metals that are processed into silver alloy t
MatroZZZ [7]

Answer: Income earned for cups = $1,000

Explanation:

Given:

Materials cost = $40,000

Labor cost = $44,000

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TSC sold the platters for $100,000 and the cups for $12,000

There will be a decrease in net income due to non-selling of cups

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Thus, the Company's total income will decrease by $10,000 if it stops making and selling cups.

Joint cost allocated to cups

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= $9,000

∴

Income earned for cups

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