How much must she pay to retire the mortgage

Assignment Help Financial Management
Reference no: EM13954837

A borrower took out a 30-year fixed-rate mortgage of $2,250,000 at a 6.2% annual rate with monthly payments. After five years, she wishes to pay off the remaining balance. Interest rates have by then fallen to 4.0%. How much must she pay to retire the mortgage (to the nearest dollar)?

Reference no: EM13954837

Questions Cloud

Davenport mills is a division of iowa woolen products : Davenport Mills is a division of Iowa Woolen Products, Inc. For the most recent year, Davenport had net income of $19,900,000. Included in income was interest expense of $1,430,000.
Benefits of a large and diverse investment portfolio : The Nebraska Institute of Science (NIS) pools all of its endowment funds so that it can obtain the benefits of a large and diverse investment portfolio. The institute recently acquired a commercial office building as an investment property. What woul..
Probability that this book received unfavorable review : What is the probability that a randomly selected published textbook receive favorable review?
Difference between resources used and resources supplied : manufactures two types of shoes Compute unused capacity for these items difference between resources used and resources supplied
How much must she pay to retire the mortgage : A borrower took out a 30-year fixed-rate mortgage of $2,250,000 at a 6.2% annual rate with monthly payments. After five years, she wishes to pay off the remaining balance. Interest rates have by then fallen to 4.0%. How much must she pay to retire th..
What is the internal rate of return : What is the internal rate of return of the investment?
Die machines to produce equipment for other firms : Tool Makers, Inc. uses tool and die machines to produce equipment for other firms. The initial cost of one customized tool and die machine is $850,000. This machine costs $10,000 a year (after-tax) to operate. Each machine has a life of 3 years befor..
About these cultures-specifically their economic : Your fast-food franchise has been cleared for business in all 4 countries (United Arab Emirates, Israel, Mexico, and China). You now have to start construction on your restaurants.
Bonds outstanding that are currently selling at par value : Jack’s Construction Co. (JCC) has 80,000 bonds outstanding that are currently selling at par (face) value. Bonds with similar characteristics are currently yielding 8.5%. The company also has 4 million shares of common stock outstanding. The stock ha..

Reviews

Write a Review

Financial Management Questions & Answers

  Evaluating value of long-term elements of capital structure

Determine the value of the long-term elements of the capital structure, and find out the target percentages for the optimal capital structure. Carry weights to 4 decimal places.  Evaluate the retained earnings break point.

  How do credit managers manage the risks

How do credit managers manage the risks related to extending trade credit? Aside from late or non-payment, what other risks do you see with trade credit?

  About the current and quick ratios

The Nelson Company has $977,500 in current assets and $425,000 in current liabilities. Its initial inventory level is $340,000, and it will raise funds as additional notes payable and use them to increase inventory. How much can Nelson's short-term d..

  Exchange rate value of the euro

If the exchange rate value of the euro goes from U.S. $1.15 to U.S. $1.05, then:

  The price of corporation stock is expected

The price of Corporation stock is expected to be $68 in 5 years. Dividends are anticipated to increase at an annual rate of 20 percent from the most recent dividend of $2.00. If your required rate of return is 16 percent, how much are you willing to ..

  The amounts of total net operating capital for both years

The following Income Statement and Balance Sheet is for Damian's and Weston's Company: $K 2015 2014 Sales 60 20 Operating Costs 25 8 Depreciation 4 2 EBIT 31 10 Less Interest 0.5 0.5 Earnings before Taxes 30.5 9.5 Taxes @ 40% 12.2 3.8. What are the a..

  What is the firms intrinsic value today

Terrell Enterprises recently paid a dividend, D0, of $1.50. It expects to have non constant growth of 25% for 2 years followed by a constant rate of 6% thereafter. The firm's required return is 12%. What is the firm's intrinsic value today?

  Calculate the present value of the costs incurred under plan

Suppose that a major city’s main thoroughfare, which is also an interstate highway, will be completely closed to traffic for two years, from January 2014 to December 2015, for reconstruction at a cost of $535 million. Calculate the present value of t..

  How much can he spend each year after he retires

Your older brother turned 35 today, and he is planning to save $30,000 per year for retirement, with the first deposit to be made one year from today. He will invest in a mutual fund that's expected to provide a return of 7.5% per year. He plans to r..

  Bill plans to fund his individual retirement account

The present value of $25,000 perpetuity at a 14 percent discount rate is ___ Bill plans to fund his individual retirement account (IRA) with the maximum contribution of $2,000 at the end of each year for the next 20 years. If Bill can earn 12 percent..

  What is the current market rate on this bond

A 25-year bond was issued eight years ago. The bond pays an annual coupon rate (once a year) of 8.75%. Currently, the bond sells for $1,210. What is the current market rate on this bond?

  Borrower to pay two points to lender up front-repay loan

You are looking at a one-year loan of $15,000. The interest rate is quoted as 10.0 percent plus two points. A point on a loan is simply 1 percent (one percentage point) of the loan amount. Quotes similar to this one are common with home mortgages. Th..

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd