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You are taking out a 100,000 mortgage loan to be repaid over 25 years in 300 monthly paymentsa) if the interest rate is 16% per year what is the amount of the monthly payment?Answer: PMT = 1,358.89b) if you can afford to pay 1500 per month and need to borrow 100,000 how many months would it take to pay off the mortgage?
Answer: n = 166
c) if you can pay 1500 per month, need to borrow 100000, and want a 25 year mortgage, what is the highest interest rate you can pay?Answer: i= 1.482% per mo.
What does the below mean?
- Do not round off the interest rate when computing the monthly rate, or you will not get the same answer reported here.
- You must input PMT and PV with opposite signs.
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