Carlos purchased a house for $230,000; he paid $11500 as a down payment and financed the balance amount at 3.9% compounded monthly for 25 years. a) What is the size of payment made at the end of every month to settle the loan? b) What was the amount of interest charged for the entire loan? c) If Carlos pays an additional $100 per month, how many periods will it take to payoff the load? d) If Carlos pays an additional $100 per month, how much interest will be saved?
Carlos purchased a house for $230,000; he paid $11500 as a down payment and financed the balance amount at 3.9% compounded monthly for 25 years. a) What is the size of payment made at the end of every month to settle the loan? b) What was the amount of interest charged for the entire loan? c) If Carlos pays an additional $100 per month, how many periods will it take to payoff the load? d) If Carlos pays an additional $100 per month, how much interest will be saved?
Chapter4: Time Value Of Money
Section: Chapter Questions
Problem 25PROB
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VIEWa) Calculation of size of payment made at the end of every month to settle the loan:
VIEWb) Calculation of Amount of Interest Charged on Entire Loan:
VIEWc) Calculation of New Loan period if Carol pays additional $100 per month:
VIEWd) Calculation of Total Interest Saved if Carol pays additional $100 per month:
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ISBN:
9781111581565
Author:
Gaylord N. Smith
Publisher:
Cengage Learning