If you have a mortgage on your house at 6 percent and the inflation rate when the mortgage was acquired was 3 percent but has since increased and is now 8 percent per year; the current real interest rate is O A. 6 percent per year. O B. 14 percent per year. O C. O percent per year. O D. 8 percent per year. OE. -2 percent per year.

If you have a mortgage on your house at 6 percent and the inflation rate when the mortgage was acquired was 3 percent but has since increased and is now 8 percent per year; the current real interest rate is O A. 6 percent per year. O B. 14 percent per year. O C. O percent per year. O D. 8 percent per year. OE. -2 percent per year.

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

See similar textbooks

Similar questions

You take out a mortgage for $320,000 at 3% compounded monthly. What are your monthly payments if the mortgage is for 20 years? O $1,774.71 O $799.00 O $1,888.83 O $977.15 O $974.71
EAR. What is the effective annual rate (EAR) of a mortgage that is advertised at 9.75% (APR) over the next twenty years and paid with monthly payments? What is the effective annual rate (EAR) of the mortgage at 9.75% APR with monthly payments?
Theodore D. Kat is applying to his credit union for a mortgage of $200,000. The bank has quoted 8% an interest rate. He would pay off the mortgage over 25- years (amortization period) and make a payment at the end of each month. A. Calculate EAR (1/100 of one percent, no %, e.g. 9.35) B. How much are Theodore's monthly payments?
7.
Consider a 30-year, fixed-rate mortgage for $120,000 at a nominal rate of 6% with monthly payments. If the borrower pays an additional $120 with each monthly payment, what will be the amount of the last monthly payment? A. $839.46 B. $357.77 C. $843.66 D. $419.85 E. $355.99 F. $420.90 G. $418.81 H. $841.55
You just took out a 15-year traditional fixed-rate mortgage for $300,000 to buy a house. The interest rate is 10.8% (APR) and you have to make payments monthly. a. What is your monthly payment?b. How much of your first monthly payment goes towards paying down the outstanding balance (in $)?c. What is the outstanding balance after 1 year if you have made all 12 payments on time? d.
Which mortgage would result in higher total payments? Mortgage A: $985 a month for 30 years Mortgage B: $780 a month for 5 years and 1,056 for 25 years
PLEASEEE THNAKS
b. You have a $300,000 mortgage with a 3.6% annual percentage rate with monthly compounding and a 30-year maturity. What is the monthly payment on your mortgage? What is the effective annual interest rate on your mortgage?
A borrower made a constant payment mortgage loan 8 years ago for $400,000 at 12 percent interest for 30 years. 1. What is the monthly payment? 2. What is the current loan balance? 3. Assume this is homeowner has been offered a chance for refinance for the amount at the current balance for 22 years at 10.5% interest rate. What is the monthly payment if the homeowner chooses to refinance? 4. If the origination fees and closing costs are $25,500, and the costs are not financed by the lender. What is the effective cost of refinancing? Should this homeowner refinance? 5. If this homeowner plans to sell the house in 5 years, should this homeowner refinance (show your answer with the effective annual rate)? use excel to get the answers and show the formulas
Suppose that four years ago you took out a Canadian mortgage for $683,000at an APR of 3.37% with monthly payments to be amortized over 25 years. You have been paying$3363.32 per month. Today, you have the opportunity to refinance your mortgage at 1.98% for your monthly payments for the remaining 21 years. (a) Calculate the e§ective monthly interest rate and the remaining balance of the loan outstanding when 21 years remain to the loan. (b) Find the new e§ective monthly interest rate if you decide to refinance at 1.98%. How much would your new monthly payment be?
Consider a home mortgage of $125,000 at a fixed APR of 4.5% for 25 years. a. Calculate the monthly payment. b. Determine the total amount paid over the term of the loan. c. Of the total amount paid, what percentage is paid toward the principal and what percentage is paid for interest. ..... a. The monthly payment is $ (Do not round until the final answer. Then round to the nearest cent as needed.)

SEE MORE QUESTIONS

Recommended textbooks for you

Essentials Of Investments

Finance

ISBN:

9781260013924

Author:

Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:

Mcgraw-hill Education,

FUNDAMENTALS OF CORPORATE FINANCE

Finance

ISBN:

9781260013962

Author:

BREALEY

Publisher:

RENT MCG

Financial Management: Theory & Practice

Finance

ISBN:

9781337909730

Author:

Brigham

Publisher:

Cengage

Foundations Of Finance

Finance

ISBN:

9780134897264

Author:

KEOWN, Arthur J., Martin, John D., PETTY, J. William

Publisher:

Pearson,

Fundamentals of Financial Management (MindTap Cou…

Finance

ISBN:

9781337395250

Author:

Eugene F. Brigham, Joel F. Houston

Publisher:

Cengage Learning

Corporate Finance (The Mcgraw-hill/Irwin Series i…

Finance

ISBN:

9780077861759

Author:

Stephen A. Ross Franco Modigliani Professor of Financial Economics Professor, Randolph W Westerfield Robert R. Dockson Deans Chair in Bus. Admin., Jeffrey Jaffe, Bradford D Jordan Professor

Publisher:

McGraw-Hill Education

Essentials Of Investments

Finance

ISBN:

9781260013924

Author:

Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:

Mcgraw-hill Education,

FUNDAMENTALS OF CORPORATE FINANCE

Finance

ISBN:

9781260013962

Author:

BREALEY

Publisher:

RENT MCG

Financial Management: Theory & Practice

Finance

ISBN:

9781337909730

Author:

Brigham

Publisher:

Cengage

Foundations Of Finance

Finance

ISBN:

9780134897264

Author:

KEOWN, Arthur J., Martin, John D., PETTY, J. William

Publisher:

Pearson,

Fundamentals of Financial Management (MindTap Cou…

Finance

ISBN:

9781337395250

Author:

Eugene F. Brigham, Joel F. Houston

Publisher:

Cengage Learning

Corporate Finance (The Mcgraw-hill/Irwin Series i…

Finance

ISBN:

9780077861759

Author:

Stephen A. Ross Franco Modigliani Professor of Financial Economics Professor, Randolph W Westerfield Robert R. Dockson Deans Chair in Bus. Admin., Jeffrey Jaffe, Bradford D Jordan Professor

Publisher:

McGraw-Hill Education

SEE MORE TEXTBOOKS