Present worth of 600 monthly for 20 years at APR=24%:
P=A*(P/A, 2%, 480)
=600*(1.02^480-1)/[(.02)(1.02^480)]
=29,997.766
Therefore down-payment
=50000-P
=50000-29,997.766
=20,002.23
Interest charged
=future value - present value
=29997.766*[(1.02^480)-1]
=402,845.97
(no interest paid on down-payment).
I'll leave the calculation of percentage of down-payment to selling price to you.
Jacson purchased a house for Birr 50,000. He made an amount of down payment and pay monthly Birr 600 to retire the mortage for 20 years at annual interest rate of 24% compounded monthly.
Find mortage
down payment
interest charged
percentage of down payment to selling price.
3 answers
P = (Po*r*t)/(1-(1+r)^-t.
P = 600 * 240 = 144,000
X = Down payment.
Po = 50,000-x
r = 0.24/12 = 0.02/mo.
t = 20 * 12 = 240 mo.
144,000 = (50,000-x)*0.02*240)/(1-(1.02)^(-240))
X = 20,258.87
Po = 50,000-20,258.87 = 29,741.13
I = P-Po
P = 600 * 240 = 144,000
X = Down payment.
Po = 50,000-x
r = 0.24/12 = 0.02/mo.
t = 20 * 12 = 240 mo.
144,000 = (50,000-x)*0.02*240)/(1-(1.02)^(-240))
X = 20,258.87
Po = 50,000-20,258.87 = 29,741.13
I = P-Po
What about the mortgage?