Reference no: EM133110896

1. Consider a 25-year fixed-rate mortgage for $160,000 at a nominal interest rate of 8.80%. 

A. How much is the required monthly payment?

B. How much of the payment goes toward principal and interest during the first 3 months?

C. What is the total amount of interest paid over the life of the loan?

2. Consider a 30-year fixed-rate mortgage with a monthly payment of $1,200.

A. Assuming a nominal interest rate of 6%, how much is the principal of the mortgage?

B. Assuming a nominal interest rate of 7%, how much is the principal of the mortgage?

C. What is the difference in maximum housing prices if both mortgages require 5% down payment?

3. An investor in England purchased a 91-day T-bill with the face value of $10,000 for $9,876.50. At that time, the exchange rate was $1.75 per pound. At maturity, the exchange rate was $1.83 per pound. What was the investor's holding period return in pounds?

4. A Malaysian investor purchased 100 of Apple stock on January 31, 2016, at $153.00 per share. Apple paid an annual dividend of $1.50 per share on December 31, 2016. The investor sold the stock on the same day for $168.00 per share. The exchange rate was MYR 4.14 per U.S. dollar on January 31, 2016, and MYR 4.50 per U.S. dollar on December 31, 2016. What is the investor's total return in Malaysian ringgit?