A lending agency advertises in the paper an APR of 12% on a home mortgage with a term of 30 years. The ad claims that the monthly payment on a principal of $200,000 will be $20,570. Is this claim reasonable? What should the ad have said the payment would be (to the nearest dollar)? O The ad should have said that the monthly payment is $200,000. O The claim is reasonable. The ad was correct to say that monthly payment is $20,570. O The ad should have said that the monthly payment is $2,000. O The ad should have said that the monthly payment is $2,057.
A lending agency advertises in the paper an APR of 12% on a home mortgage with a term of 30 years. The ad claims that the monthly payment on a principal of $200,000 will be $20,570. Is this claim reasonable? What should the ad have said the payment would be (to the nearest dollar)? O The ad should have said that the monthly payment is $200,000. O The claim is reasonable. The ad was correct to say that monthly payment is $20,570. O The ad should have said that the monthly payment is $2,000. O The ad should have said that the monthly payment is $2,057.
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
Problem 1PS
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Transcribed Image Text:A lending agency advertises in the paper an APR of 12% on a home mortgage with a term of 30 years. The ad claims that the monthly payment on a principal of $200,000 will be $20,570.
Is this claim reasonable? What should the ad have said the payment would be (to the nearest dollar)?
O The ad should have said that the monthly payment is $200,000.
The claim is reasonable. The ad was correct to say that monthly payment is $20,570.
O The ad should have said that the monthly payment is $2,000.
O The ad should have said that the monthly payment is $2,057.
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