This is the part i got the solutions wrond. please help me **Mortgage Calculation Example**To determine the regular payment amount for a mortgage, use the formula:\[ \text{PMT} = \frac{P \left( \frac{r}{n} \right)}{1 - \left( 1 + \frac{r}{n} \right)^{-nt}} \]Where:- $ \text{PMT} $ is the monthly payment- $ P $ is the principal amount (loan amount)- $ r $ is the annual interest rate (as a decimal)- $ n $ is the number of payments per year- $ t $ is the number of years**Scenario:**- The price of a small cabin is $55,000.- The bank requires a 5% down payment.- The buyer is offered two mortgage options: - 20-year fixed at 10% - 30-year fixed at 10%**Objective:**1. Calculate the monthly payment for the 20-year option.2. Calculate the total amount of interest paid for each option.3. Determine how much the buyer saves in interest with the 20-year option compared to the 30-year option.**Step 1: Find the Monthly Payment for the 20-Year Option**Calculate the monthly payment using the given formula and rounding to the nearest dollar as needed.[Insert calculation steps here, followed by the answer box.](Note: This example does not include graphs or diagrams.)

Use PMT= to determine the regular payment amount, rounded to the nearest dollar. The price of a small cabin is $55,000. The bank requires a 5% down payment. The buyer is -nt" [1₁- (₁ + 5) offered two mortgage options: 20-year fixed at 10% or 30-year fixed at 10%. Calculate the amount of interest paid for each option. How much does the buyer save in interest with the 20-year option? Find the monthly payment for the 20-year option. $ (Round to the nearest dollar as needed.)

Use PMT= to determine the regular payment amount, rounded to the nearest dollar. The price of a small cabin is $55,000. The bank requires a 5% down payment. The buyer is -nt" [1₁- (₁ + 5) offered two mortgage options: 20-year fixed at 10% or 30-year fixed at 10%. Calculate the amount of interest paid for each option. How much does the buyer save in interest with the 20-year option? Find the monthly payment for the 20-year option. $ (Round to the nearest dollar as needed.)

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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