Question

a seasch the wob h M very goods You noticed that their monthly mortgege payment was 1600 The corect anewer is $1,0000 Question 12 Using your last twa answers, how much do you think the Campanas still owe on their house assuming an interest rate of 875% Bear in mind that we are talking about a mortgage here, not an investment, per se. [Gve your answer to the nearest cent.) Aresaet mare hoenes tee

The last 2 answers are monthly mortgage payment $1,600.00 and the mortgage as a remainder of 20 years.

Answer 1

Monthly loan payment = $1,600 Remaining term of loan = 20 Years * 12 = 240 Months Interest rate = 8.75% * 1/12 = 0.72916667% Per month Remaining amount of loan owe = Present value of monthly payments = Monthly payment *[1-(1+I) -n]/I = $1,600 * [1-(1 +0.72916667%)^-240 ]/0.72916667% = $1,600 *[1 -0.17488081 / 0.00729167 = $1,600 * 113.159204 = $181,054.726 = $181,055 (Rounded) Ans : $181,055