Abbey purchased a house using a fixed rate mortgage.

Ответ:

hhh4775

09.03.2022

Monthly payment is $1448.82

Step-by-step explanation:

Given : Abbey purchased a house using a fixed rate mortgage. The annual interest rate is 4.2% compounded monthly for 20 years. The mortgage amount is $235,000.

To find : What is the monthly payment on the mortgage?

Solution : First we find the monthly payment

Formula of monthly payment

Monthly payment, $M=\frac{\text{Amount}}{\text{Discount factor}}$

Discount factor $D=\frac{1-(1+i)^{-n}}{i}$

Where, Amount = $235,000

Rate r= 4.2%=0.042

$i=\frac{0.042}{12}=0.0035$

Time = 20 years

$n=20\times12=240$

Now, put all the values we get,

$D=\frac{1-(1+i)^{-n}}{i}$

$D=\frac{1-(1+0.0035)^{-240}}{0.0035}$

$D=\frac{1-(1.0035)^{-240}}{0.0035}$

$D=\frac{1-0.4323}{0.0035}$

$D=\frac{0.5677}{0.0035}$

D=162.2

Monthly payment, $M=\frac{\text{Amount}}{\text{Discount factor}}$

$M=\frac{235000}{162.2}$

M=1448.82

Approximately,monthly payment is $1448.82

0,0(0 оценок)

Abbey purchased a house using a fixed rate mortgage. the annual interest rate is 4.2% compounded monthly for 20 years. the mortgage amount is $235,000. what is the monthly payment on the mortgage? this isn't a multiple choice question have to show my work

Ответ:

Ответ:

Ask your question to the AI advisor

More tips

Answers on questions: Mathematics

Ask an AI advisor a question