Calculate annual interest rate which is compounded monthly, Civil Engineering

Assignment Help:

You wish to buy a house and you can afford to make a down payment of $50,000. Your monthly mortgage payment cannot exceed $2,000. If 30-year loans are available at 7.5% annual interest rate which is compounded monthly, the highest price that you may consider is most nearly:

Solution:

n = 360 months interest = 7.5%-annual ÷ 12-months/year = 0.625% per month

Apply the equation:      

i (1+i)n / (1+i)n - 1

This yields (A/P, 0.00625, 360) = 0.00699 

Apply the following equation to find the highest price to consider:

P x 0.00699 = (Highest $  -  $50,000) x 0.00699   ≤   $2,000

Highest $ ≤   ($2,000/0.00699) + $50,000 = $336,123


Related Discussions:- Calculate annual interest rate which is compounded monthly

Determine the magnitude of application of the active thrust, A retaining wa...

A retaining wall 9 m high retains cohesion less soil, with an angle of internal friction 33°. The surface is level with the top of the wall. The unit weight of the top 3 m of the f

Chain surveying, describe setting out right angle at given point on a chain...

describe setting out right angle at given point on a chain line and when the point lies outside the chain line

Building plan, the conventional symbol used in building plan

the conventional symbol used in building plan

Construction of concrete carriageway, Question If construction of conc...

Question If construction of concrete carriageway is carried out in summer, be capable of expansion joints be omitted? Answer If construction of concrete carriageway

Advantages and disadvantages of water transport, Advantages and Disadvantag...

Advantages and Disadvantages of Water Transport: The following are the advantages of water transport: (a)        Since the vessels travel on water, no investment is needed

.., Ask questiPermanent Way:on #Minimum 100 words accepted#

Ask questiPermanent Way:on #Minimum 100 words accepted#

Explain the hydraulic gradient, Explain the Hydraulic Gradient A measur...

Explain the Hydraulic Gradient A measurement of the movement of water over distances. Change in hydraulic head from one monitoring point to another.  i = ΔH/L  units are typ

Civil Engineering, I. A horizontal 500 lb force acts at a point D of cranks...

I. A horizontal 500 lb force acts at a point D of crankshaft AB which is held in static equilibrium by a twisting couple and by reactions at A and B. Knowing that the bearings are

Write Your Message!

Captcha
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