You need to borrow $750,000 to purchase a new house. JRE bank will loan you the money atan AP of 4.3% (monthly compounding) and a 15 year term (i.e. 180 monthly payments in total). After making exactly 27 payments, what is the total amount of interest you will have paid (rounded to the nearest dollar)? The total amount of interest is closest to: i. $63,309 B. $84,140 C. $68,709 D. $70,734

Here's how to solve the problem:Formula:To calculate the total interest paid after 27 payments, we…

Answered: You need to borrow $750,000 to purchase…

Corporate Fin Focused Approach

5th Edition

ISBN:9781285660516

Author:EHRHARDT

Publisher:EHRHARDT

Chapter4: Time Value Of Money

Section4.17: Amortized Loans

Problem 1ST

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You need to borrow $750,000 to purchase a new house. JRE bank will loan you the money at an APR of 4.3% (monthly compounding) and a 15 year term (i.e. 180 monthly payments in total). After making exactly 27 payments, what is the total amount of interest you will have paid (rounded to the nearest dollar)? The total amount of interest is closest to: A. $63,309 B. $84,140 c. $68,709 O D. $70,734
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