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Mortgages have an APR (annual percentage rate - a stated rate) of 6.24%. Payments and compounding are monthly.
a. What is the effective monthly rate?
b. You decide that you can afford monthly mortgage payments of $3,100.00 and wish to take out a 30 year mortgage. How much can you borrow to buy a house in Newbury Park?
c. How much of your first payment will be principal? How much will be interest? (If you had trouble with part b, assume that you will borrow $500,000.00.)
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