Explanation Given Information: Amount financed is $ 100000, interest rate is 9.25 % for 30 years and the interest rate is 8.5 % for 15 years Formula used: The formula for the number of $ 1000 is Number of $ 1000 s financed = Amount Financed 1000 Use the table 14.1 to calculate the table factor. Locate the table factor on the intersection of the number of years column and the interest rate row. The formula for Monthly payment is Monthly Payment = Number of 1000 s financed × Table Factor And, Number of payments = Term of loan × 12 Total interest is given by, Total Interest = ( Monthly payment × Number of payments ) − Amount Financed Now, Difference in total interest = total interest for 30years − total interest for 15years Calculation: Consider the provided values, Amount Financed = $100,000 Interest Rate = 9 .25 % Term of Loan = 3 0 years As, Number of $ 1000 s financed = Amount Financed 1000 To calculate number of $ 1000 financed, apply the above formula: Number of $ 1000 s financed = Amount Financed 1000 = 100000 1000 = 100 Use the table 14.1 for locating the table factor at the intersection of 30 years (column) and 9.25 % interest rate (row). So, the table factor for 30 years at 9.25 % rate of interest is 8.23. As, Monthly Payment = Number of 1000 s financed × Table Factor To calculate Monthly Payment, use above formula: Monthly Payment = Number of 1000 s financed × Table Factor = 100 × 8.23 = $ 823 As, Number of payments = Term of loan × 12 Use above formula to calculate the number of payments: Number of payments = Term of loan × 12 = 30 × 12 = 360 Then, Total Interest for 30 years = ( Monthly Payment × Number of Payments ) − Amount Financed = ( 823 × 36 0 ) − 100000 = $196280 Now consider, Amount Financed = $100,000 Interest Rate = 8

Contemporary Mathematics For Business & Consumers, Loose-leaf Version

8th Edition

ISBN: 9781305867185

Author: Robert Brechner, Geroge Bergeman

Publisher: South-Western College Pub

See similar textbooks

Concept explainers

Unitary Method

The word “unitary” comes from the word “unit”, which means a single and complete entity. In this method, we find the value of a unit product from the given number of products, and then we solve for the other number of products.

Speed, Time, and Distance

Imagine you and 3 of your friends are planning to go to the playground at 6 in the evening. Your house is one mile away from the playground and one of your friends named Jim must start at 5 pm to reach the playground by walk. The other two friends are 3 …

Profit and Loss

The amount earned or lost on the sale of one or more items is referred to as the profit or loss on that item.

Units and Measurements

Measurements and comparisons are the foundation of science and engineering. We, therefore, need rules that tell us how things are measured and compared. For these measurements and comparisons, we perform certain experiments, and we will need the experime…

Videos

Question

Chapter 14, Problem 16AT

To determine

To calculate: The difference in the total interest to be paid on $100,000 when interest rate is 9.25 % for 30 years and when interest rate is 8.5 % for 15 years.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Chapter 14, Problem 15AT

Chapter 14, Problem 17AT

Students have asked these similar questions

A market research firm used a sample of individuals to rate the purchase potential of a particular product before and after the individuals saw a new television commercial about the product. The purchase potential ratings were based on a 0 to 10 scale, with higher values indicating a higher purchase potential. The null hypothesis stated that the mean rating "after" would be less than or equal to the mean rating "before." Rejection of this hypothesis would show that the commercial improved the mean purchase potential rating. Use = .05 and the following data to test the hypothesis and comment on the value of the commercial. Purchase Rating Purchase Rating Individual After Before Individual After Before 1 6 5 5 3 5 2 6 4 6 9 8 3 7 7 7 7 5 4 4 3 8 6 6 What are the hypotheses?H0: d Ha: d Compute (to 3 decimals).Compute sd (to 1 decimal). What is the p-value?The p-value is What is your decision?

Why would you use a histograph or bar graph? Which would be better and why for the data shown.

Calculus lll May I please have the solution for the following exercise? Thank you

Chapter 14 Solutions

Contemporary Mathematics For Business & Consumers, Loose-leaf Version

Ch. 14.I - What is the monthly payment and total interest on...Ch. 14.I - Prob. 2TIE Ch. 14.I - Prob. 3TIE Ch. 14.I - Prob. 4TIE Ch. 14.I - Prob. 5TIE Ch. 14.I - Using Table 14-1 as needed, calculate the required...Ch. 14.I - Prob. 2RE Ch. 14.I - Using Table 14-1 as needed, calculate the required...Ch. 14.I - Prob. 4RE Ch. 14.I - Prob. 5RE

Ch. 14.I - Prob. 6RE Ch. 14.I - Using Table 14-1 as needed, calculate the required...Ch. 14.I - Prob. 8RE Ch. 14.I - As one of the loan officers for Grove Gate Bank,...Ch. 14.I - As one of the loan officers for Grove Gate Bank,...Ch. 14.I - As one of the loan officers for Grove Gate Bank,...Ch. 14.I - As one of the loan officers for Grove Gate Bank,...Ch. 14.I - As one of the loan officers for Grove Gate Bank,...Ch. 14.I - As one of the loan officers for Grove Gate Bank,...Ch. 14.I - Ben and Mal Scott plan to buy a home for $272,900....Ch. 14.I - 16. Michael Sanchez purchased a condominium for...Ch. 14.I - 17. Luis Schambach is shopping for a 15-year...Ch. 14.I - 18. Phil Pittman is interested in a fixed-rate...Ch. 14.I - 19. Larry and Cindy Lynden purchased a townhome in...Ch. 14.I - Heather Gott bought a home with an adjustable-rate...Ch. 14.I - Joe and Gloria Moutran art purchasing a house in...Ch. 14.I - 22. You are a real estate broker for Aurora...Ch. 14.II - Justin Schaefer owns a home that was recently...Ch. 14.II - Roman Bass cams a gross income of $3,100 per...Ch. 14.II - For the following second mortgage applications,...Ch. 14.II - For the following second mortgage applications,...Ch. 14.II - For the following second mortgage applications,...Ch. 14.II - For the following second mortgage applications,...Ch. 14.II - For the following second mortgage applications,...Ch. 14.II - For the following second mortgage applications,...Ch. 14.II - For the following second mortgage applications,...Ch. 14.II - Calculate the housing expense ratio and the total...Ch. 14.II - Calculate the housing expense ratio and the total...Ch. 14.II - Prob. 10RE Ch. 14.II - Prob. 11RE Ch. 14.II - Prob. 12RE Ch. 14.II - Prob. 13RE Ch. 14.II - Prob. 14RE Ch. 14.II - Use Exhibit 14-4, Lending Ratio Guidelines, on...Ch. 14.II - 16. Ronald and Samantha Brady recently had their...Ch. 14.II - Prob. 17RE Ch. 14.II - Ransford and Alda Mariano own a home recently...Ch. 14.II - Prob. 19RE Ch. 14.II - Jamie and Alice Newmark have a combined monthly...Ch. 14.II - Prob. 21RE Ch. 14.II - According to moncy.CNN.com. with mortguge rates...Ch. 14 - 1. Land, including permanent improvements on that...Ch. 14 - A(n) ___________ is a loan in which real property...Ch. 14 - Mortgage ___________ points are an extra charge...Ch. 14 - Prob. 4CR Ch. 14 - 5. A(n) ___________ account is a bank account used...Ch. 14 - Prob. 6CR Ch. 14 - Prob. 7CR Ch. 14 - Prob. 8CR Ch. 14 - Prob. 9CR Ch. 14 - Prob. 10CR Ch. 14 - A home equity ___________ is a lump-sum second...Ch. 14 - Prob. 12CR Ch. 14 - Prob. 13CR Ch. 14 - Prob. 14CR Ch. 14 - Prob. 1AT Ch. 14 - Prob. 2AT Ch. 14 - Suzanne Arthurs purchased a home with a $146,100...Ch. 14 - Prob. 4AT Ch. 14 - Prob. 5AT Ch. 14 - Prob. 6AT Ch. 14 - Prob. 7AT Ch. 14 - Prob. 8AT Ch. 14 - Prob. 9AT Ch. 14 - Prob. 10AT Ch. 14 - Prob. 11AT Ch. 14 - 12. Dale Evans bought the Lazy D Ranch with an...Ch. 14 - 13. Diversified Investments purchased a 24-unit...Ch. 14 - Larry Mager purchased a ski lodge in Telluride for...Ch. 14 - 15. A Denny’s Restaurant franchisee is looking for...Ch. 14 - Prob. 16AT Ch. 14 - Adam Marsh is purchasing a $134,000 condominium...Ch. 14 - Prob. 18AT Ch. 14 - Prob. 19AT Ch. 14 - Prob. 20AT Ch. 14 - 21. Phil Armstrong earns a gross income of $5,355...Ch. 14 - 22. Magda Leon is applying for a home mortgage...

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, subject and related others by exploring similar questions and additional content below.

The difference in the total interest to be paid on $ 100 , 000 when interest rate is 9.25 % for 30 years and when interest rate is 8.5 % for 15 years.

Solution Summary: The author calculates the difference in the total interest to be paid on a 30-year fixed rate mortgage at 9.25 % when interest rate is 8.5

Concept explainers

Videos

To calculate: The difference in the total interest to be paid on $100,000 when interest rate is 9.25 % for 30 years and when interest rate is 8.5 % for 15 years.

Want to see the full answer?

Chapter 14 Solutions