A professional couple wishes to purchase a new home costing $750,000, make a 20 percent downpayment, and finance the remaining $600,000. The rate quoted for a conventional 30-year loan is 6.5084percent interest with 1.875 points and no other closing costs. If, immediately after the one hundredtwentieth payment (10 years), the professional couple decides to sell the house, what will be the unpaidbalance on the loan with the points added to it?

Let's examine the computation in greater detail: 1. Original Loan Amount: Representing 80% of the…

Answered: A professional couple wishes to…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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A mortgage broker is offering a 20-year $185,900 mortgage. The borrower makes monthly payments on a 4.2 percent APR interest rate. What are the monthly payments? (Do not round intermediate calculations and round your final answer to 2 decimal places.) Monthly payment
Consider a 529 (college savings) plan that will pay $20,000 once a year for a 4-year period (4annual payments). The first payment will come in exactly 5 years (at the end of year 5) and thelast payment in 8 years (at the end of year 8). What is the duration of the pension obligation? The current interest rate is 8% per yearfor all maturities.
Which of the following statements is CORRECT? The present value of a 3-year, $150 ordinary annuity will exceed the present value of a 3-year, $150 annuity due. If a loan has a nominal annual rate of 8%, then the effective rate will never be less than 8%. If a loan or investment has annual payments, then the effective, periodic, and nominal rates of interest will all be different. The proportion of the payment that goes toward interest on a fully amortized loan increases over time. An investment that has a nominal rate of 6% with semiannual payments will have an effective rate that is smaller than 6%.
Compute the discount if $ 2,000 is discounted for 6 months at 8% simple interest
Many retirement funds charge an administrative fee equal to 0.25% on managed assets. Suppose that Alexx and Spenser each invest $7 comma 000 in the same stock this year. Alexx invests directly and earns 7% a year. Spenser uses a retirement fund and earns 6.75% Part 2 If Alexx and Spenser leave their investments in place for 30 years, with annual compounding of the interest, how much more will Alexx have than Spenser at the end of the 30-year period? Part 3 Alexx will have $ enter your response here ore than Spenser after 30 years. (Enter your response rounded to two decimal places.). Answer detailed in step by step method and don't use AI I will downvote
Many retirement funds charge an administrative fee equal to 0.25% on managed assets. Suppose that Alexx and Spenser each invest $4,000 in the same stock this year. Alexx invests directly and earns 4% a year. Spenser uses a retirement fund and eams 3.75%. If Alexx and Spenser leave their investments in place for 30 years, with annual compounding of the interest, how much more will Alexx have than Spenser at the end of the 30-year period? Alexx will have more than Spenser after 30 years. (Enter your response rounded to two decimal places.)
A trust fund is to be formed by depositing $4,000 every six months for 25 years in a bank that promises to pay a fixed rate over the entire term. If the amount of the fund at the end of the term is $300,000, then the rate compounded semi-annually is Hide answer choices (A) 20.40%. B 10.20%. C 1.57%. D) 33.33%. E 3.14%.
In 1803, Napoleon sold the Louisiana Territory to the United States for $0.04 per acre. In 2017, the average value of an acre at this location is $10,000.What annual compounded percentage increase in value of an acre of land has been experienced?
You plan to retire after working for 45 years. You estimate you need $6,000,000 to retire and live comfortably. Assume time zero is today and you will retire at the end of 45 years. Other opportunities exist to invest available capital elsewhere and earn a nominal 7% interest rate each year compounded annually. A. What amount would you need to invest each year, including today (Year 0 through 45), to fully fund your $6,000,000 retirement goal? B. How much money will you be living on annually for the next 30 years after retirement (Year 46 through 76) if you reach your retirement goal of $6,000,000?
On your 23rd birthday you decide to invest $4,500 (10% of your annual salary) in a mutual fund earning 7% per year. You will continue to make annual deposits equal to 10% of your annual salary until you retire at age 62 (40 years after you started your job). You expect your salary to increase by an average of 4% each year during this time. How much money will you have accumulated in your mutual fund when you retire?
You have just purchased 200 shares of General Electric stock at $15 per share. You will sell the stock when its market price doubles. If you expect the stock price to increase 12% per year, how long do you expect to wait before selling the stock? (See Figure.)
A firm borrows $2000 for 6 yr at 8%, to be repaid in a lump sum at the end of 6 yr. At the end of 6 year, the firm renews the loan for the amount due plus $3000 more for 2 yr at 8%. What is the most nearly the amount of the loan renewal? 7021 6376 7201 6673

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