Find the original amount of the mortgage loan

Assignment Help Finance Basics

Reference no: EM131095085

1. A mortgage loan is repaid with annual installment payments payable at the end of each year for 30 years. Each subsequent payment is 2% higher than the previous one. The interest rate charged on the loan balance is:

10% in the years 6k + 1,
9% in the years 6k + 2,
7% in the years 6k + 3,
8% in the years 6k + 4,
7.5% in the years 6k + 5,
8.5% in the years 6k + 6,

where k = 0, 1, 2, 3, 4. The principal repaid in the 28-th installment is 33,990. Find the original amount of the mortgage loan.

2. Steve took a loan of $10,000 at the annual effective interest rate is 7.5%. He wishes to pay the loan back in full at the end of the 10 years with the balance of a sinking fund created specifically for that purpose. He makes the interest payments at the end of the every year. At the time of each interest payment he also makes a payment to the sinking fund, which earn 5% annual effective interest rate. The first payment to the sinking fund is X and every payment will increase by 10 from the previous payment. Calculate X.

Reference no: EM131095085

Questions Cloud

Identify the bioethical and political issues : In this unit, you will discuss two healthcare issues facing healthcare administrators. In a 2-page summary, you will identify the bioethical and political issues and discuss how you would effectively and ethically handle the situations.

Suppose that the money demand function of country : Suppose that the money demand function of country Y is (M/P)d = L(i, Y ) = L(r + Eπ, Y ). (a) Write down the equilibrium conditions of real money balances (b) What will happen to the inflation rate, if money supply goes up? (c) What will happen to th..

Discuss the likely effects on labor force participation : Assume that a state government currently provides no child-care subsidies to working single parents, but that it now wants to adopt a plan that will encourage labor force participation among single parents. Discuss the likely effects on labor force p..

Supply curves for the cigarette market : Statistical studies have shown that the price elasticity of demand is -0.4, and the price elasticity of supply is 0.5. Using this information, derive linear demand and supply curves for the cigarette market.

Find the original amount of the mortgage loan : A mortgage loan is repaid with annual installment payments payable at the end of each year for 30 years. Each subsequent payment is 2% higher than the previous one. Find the original amount of the mortgage loan

Right about demand and supply : If both the agency and the board are right about demand and supply, what is the free market price? What is the change in city population if the agency sets a maximum average monthly rental of $300, and all those who cannot find an apartment leave ..

Leadership duties regarding managing-balancing governance : comment on their description of leadership duties regarding managing and balancing governance and decision-making processes for their impact on stakeholders and corporate culture.

The bill has arrived for the marketing materials : Kyle, Brian and Pam are all partners in a general partnership that is engaged in the business of event planning. Kyle contributed 45% of the capital, Brian contributed 40% of the capital, and Pam contributed 15% of the capital of the partnership. Wit..

Who is in charge of specific functions and tasks : What are the most significant differences that you found between developing a natural hazard emergency management plan and developing a man-made hazard emergency management plan? Explain.

User Account

All Pages