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3.54 You borrow $200,000 with a 25-year payback term and a variable APR that starts at 8% and can be changed every five years. 1 (a) What is the initial monthly payment? (b) If, at the end of five years, the lender's interest rate changes to 9% (APR), what will the new monthly payment be? Ans: 4) P = 200000 i permonth 8% 12 N = 12 x 25 = 300 A = 2 = 200000 2 3 %0

3.54 You borrow $200,000 with a 25-year payback term and a variable APR that starts at 8% and can be changed every five years. 1 (a) What is the initial monthly payment? (b) If, at the end of five years, the lender's interest rate changes to 9% (APR), what will the new monthly payment be? Ans: 4) P = 200000 i permonth 8% 12 N = 12 x 25 = 300 A = 2 = 200000 2 3 %0

Essentials Of Investments
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
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3.54 You borrow $200,000 with a 25-year payback term and a variable APR that starts at 8% and can be changed every five years. 1 (a) What is the initial monthly payment? (b) If, at the end of five years, the lender's interest rate changes to 9% (APR), what will the new monthly payment be? Ans: 4) P = 200000 i permonth 8% 12 N = 12 x 25 = 300 A = 2 = 200000 2 3 %0
Transcribed Image Text:3.54 You borrow $200,000 with a 25-year payback term and a variable APR that starts at 8% and can be changed every five years. 1 (a) What is the initial monthly payment? (b) If, at the end of five years, the lender's interest rate changes to 9% (APR), what will the new monthly payment be? Ans: 4) P = 200000 i permonth 8% 12 N = 12 x 25 = 300 A = 2 = 200000 2 3 %0
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