7.88 A couple buys a home and signs a mortgage contract for $120 000 to be paid with monthly payments over a 25-year period at ja = 10%. After 5 years, they renegotiate the interest rate and refinance the loan at ja = 7%. Find (a) the monthly payment for the initial 5-year period; (b) the new monthly payment after 5 years; (c) the accumulated value of the savings for the second 5-year period at j12 = 3% valued at the end of the second 5-year period; (d) the outstanding balance at the end of 10 years. Ans. (a) $1114; (6) $113 271.22; (c) $15 682.65; (d) $97 554.61 %3D
7.88 A couple buys a home and signs a mortgage contract for $120 000 to be paid with monthly payments over a 25-year period at ja = 10%. After 5 years, they renegotiate the interest rate and refinance the loan at ja = 7%. Find (a) the monthly payment for the initial 5-year period; (b) the new monthly payment after 5 years; (c) the accumulated value of the savings for the second 5-year period at j12 = 3% valued at the end of the second 5-year period; (d) the outstanding balance at the end of 10 years. Ans. (a) $1114; (6) $113 271.22; (c) $15 682.65; (d) $97 554.61 %3D
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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Transcribed Image Text:7.88 A couple buys a home and signs a mortgage contract for $120 000 to be paid with monthly
payments over a 25-year period at jz 10 %. After 5 years, they renegotiate the interest
rate and refinance the loan at ja = 7%. Find (a) the monthly payment for the initial 5-year
period; (b) the new monthly payment after 5 years; (c) the accumulated value of the savings
for the second 5-year period at j1z 3% valued at the end of the second 5-year period; (d) the
outstanding balance at the end of 10 years.
Ans. (a) $1114; (6) $113 271.22; (c) $15 682.65; (d) $97 554.61
!3!
onthle
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