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Home Q & A Board Science-Related Homework Help Mathematics
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ikrabbe ikrabbe
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6 years ago
A mortgage balance of $137 960.70 is to be repaid over a eleven-year term by equal monthly payments at 8.1% compounded semi-annually. At the request of the mortgagor, the monthly payments were set at $1140.00.
a)   How many payments will the mortgagor have to make?
b)   What is the size of last payment?
c)   Determine the difference between the total actual amount paid and the total amount required to amortize the mortgage by the contractual monthly payments.
Textbook 
Contemporary Business Mathematics with Canadian Applications

Contemporary Business Mathematics with Canadian Applications


Edition: 11th
Authors:
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#1
6 years ago
a)    p =  - 1 = 0.006638834
   n =   =   =   = 245.8378879
   246 payments

b)    PVn = 1140.00  = 1140.00(.8293897) = $949.40
   949.40(1.006638834) = $955.70

c)   137960.70 = PMT    
   137960.70 = PMT(87.73874749)    
   $1572.40 = PMT    
   Contractual = 1572.40(132)    =   $207 556.80
   Actual = 1140.00(245) + 955.70   =   280 255.70
   Difference in payments    =   $72 698.90
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