Question

Please use excel then show the formula. and screenshot

6. Assume that you want to buy a home. You find a home for which you will owe $140,000 after paying the down payment. Assume that you are able to get a 5% mortgage loan for 30 years. Payments are made monthly in arrears (at the end of the month). At the end of the 30 years, you will have paid off the entire loan. A) How much will your monthly payments be? (Hint: I recommend that you use the PMT formula available in Excel to solve this problem. You can access the Help menu to help you learn how to use the PMT function.) Remember, the loan payments are made on a monthly basis and the interest rate is 5% per year. B) What is the total amount that you will have paid in loan payments at the end of the 30 years?

7. Use the information from Question 6 except assume that the interest rate is 4%. A) How much will your monthly payments be? B) What is the total amount that you will have paid in loan payments at the end of the 30 years?

8. Use the information from Question 6 except assume that the interest rate is 6%. A) How much will your monthly payments be? B) What is the total amount that you will have paid in loan payments at the end of the 30 years? 9. Use the information from Question 6 except assume that you get a 15-year mortgage loan instead of a 30-year loan and a 5% interest rate. A) How much will your monthly payments be?

B) What is the total amount that you will have paid in loan payments at the end of the 15 years?

Answer 1

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