Werner wants to save $110 000 in 4 years to buy a cottage. He plans to make equal monthly payments of $2104.32 into an account earning 4.3% per year compounded monthly. How would Werner's monthly payments change if he saves twice as much, $220 000? a) His payments would be twice as much. b) His payments would increase but be less than twice as much. U C) His payment would be more than twice as much. a) His payments would decrease.

Advanced Engineering Mathematics
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ISBN:9780470458365
Author:Erwin Kreyszig
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Werner wants to save $110 000 in 4 years to buy a cottage.
He plans to make equal monthly payments of $2104.32 into an account earning
4.3% per year compounded monthly.
How would Werner's monthly payments change if he saves twice as much, $220
000?
a) His payments would be twice as much.
b) His payments would increase but be less than twice as much.
U C) His payment would be more than twice as much.
a) His payments would decrease.
Transcribed Image Text:Werner wants to save $110 000 in 4 years to buy a cottage. He plans to make equal monthly payments of $2104.32 into an account earning 4.3% per year compounded monthly. How would Werner's monthly payments change if he saves twice as much, $220 000? a) His payments would be twice as much. b) His payments would increase but be less than twice as much. U C) His payment would be more than twice as much. a) His payments would decrease.
Peter borrows $24 500 at 6.2% per year compounded annually.
He will pay it back by making equal annual payments of $4420.06 over 7 years.
How would Peter's annual payments change if he borrows twice as much, $49 000?
a) His payments would be exactly twice as much.
b) His payments would be more than twice as much.
U) His payments would increase but be less than twice as much.
O d) His payments would decrease.
Transcribed Image Text:Peter borrows $24 500 at 6.2% per year compounded annually. He will pay it back by making equal annual payments of $4420.06 over 7 years. How would Peter's annual payments change if he borrows twice as much, $49 000? a) His payments would be exactly twice as much. b) His payments would be more than twice as much. U) His payments would increase but be less than twice as much. O d) His payments would decrease.
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