P = Po(1+r)^n
Po = 0.85 * 275,000 = $233,750
r = (2.9%/2)/100% = 0.0145 = Semi-APR
expressed as a decimal.
n = 2comp/yr * 25yr = 50 Compounding
periods.
a. P = 233,750(1.0145)^50 = 480,124.85.
480,124.50/50 = $9,602.50 Semi-annually.
0r 480,124.85/300mo = $1600.42 Monthly.
b. Int. = 480,124.85 - 233,750 = 246,374.85
c. $480,124.85
Danielle is buying a house that costs $275000. She will finance the purchase with a 25 yr mortgage with an interest rate of 2.9%, compounded semi-annually. She must make a down payment of 15% of the purchase price.
a) How much will each payment be?
b) How much interest will Danielle end up paying by the time she has paid off the loan?
c) How much will she pay altogether for the house?
1 answer
1 answer