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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
Problem 1PS
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Part 5: Planning Ahead Say you're planning to buy one of the houses in this data set, and have your eyes on a house built in either 2008 or 2009. You don't want a second floor, and you want 2 full bathrooms, 1 half bathroom, and the biggest garage possible. Treat the sale prices as advertised list prices for this section. 5a) What is the price of the house that fits the above criteria? The price of the house would be $253,293. 5b) Assume an interest rate of 3.5%. Let's say you have enough income to budget for a payment of $913.00/month. Assume you save up enough for a down payment of $50,000.00. How many payments would you have to make to pay off the house? There would be 360 payments to pay off the house completely. Sc) How much would your monthly payment need to be to pay off the house in 15 years? The calculated monthly payment would be $1,453.31.
Transcribed Image Text:Part 5: Planning Ahead Say you're planning to buy one of the houses in this data set, and have your eyes on a house built in either 2008 or 2009. You don't want a second floor, and you want 2 full bathrooms, 1 half bathroom, and the biggest garage possible. Treat the sale prices as advertised list prices for this section. 5a) What is the price of the house that fits the above criteria? The price of the house would be $253,293. 5b) Assume an interest rate of 3.5%. Let's say you have enough income to budget for a payment of $913.00/month. Assume you save up enough for a down payment of $50,000.00. How many payments would you have to make to pay off the house? There would be 360 payments to pay off the house completely. Sc) How much would your monthly payment need to be to pay off the house in 15 years? The calculated monthly payment would be $1,453.31.
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