Question

QUESTION 11 You are buying your first home using a 30-year mortgage. The mortgage rate is 4.25 percent and the purchase price of the home is $186,000. Your down-payment is 10 percent of the purchase price, calculate your monthly mortgage payment (of principal and interest) C. $1,102.93 D.$917.1 QUESTION 12 You are celebrating your 22hd birtnday today. You have decided to start investing toward your retirement beginning one month from today. For the frst twenty years, you will invest $400 every month. During the next ten years f your investments earn a rate of return of B.6 percent throughout your working life. how much will be in your retirement account on the day you retire? you retire at age 65, you plan to invest 51.400 every month OA $4.352.744 $2.885411 Cliel Save and Submit to save and subreit. Cliek Save All Annvers to save all anneers

Answer 1

Monthly Mortgage Payment

Loan Amount (P) = $167,400 ($186,000 x 90%)

Monthly Interest Rate (n) = 0.3541667% per month (4.25% / 12 Months)

Number of Months (n) = 360 Months (30 Years x 12 Months)

Monthly Mortgage Payment = [P x {r (1+r)ⁿ} ] / [( 1+r)ⁿ – 1]

= [$167,400 x {0.003541667 x (1 + 0.003541667)³⁶⁰}] / [(1 + 0.00354166)³⁶⁰ – 1]

= [$167,400 x {0.003541667 x 3.570649}] / [3.570649 – 1]

= [$167,400 x 0.012646] / 2.570649

= $823.51 per month

“Thus, the Monthly Mortgage Payment = $823.51 per month”