Question

For extra money, you decide to invest in your mortgage. Which
statement is TRUE about mortgage prepayments?

A. Money you've invested toward
mortgage can be taken out anytime you want, like checking
account

B. The more you invest in mortgage, the
less total interest payment that you get to pay

C. Both A and B

D. None of the above

Answer #1

You just won $1200 in the lottery and you decide to invest this
money for 11 years. Three accounts pay as follows:
Account A pays 14.1% interest per year.
Account B pays 13.5% interest per year, compounded
monthly.
Account C pays 13% interest per year, compounded daily.
For each account, determine the value of your investment after
11 years.
Account A: $
Account B: $
Account C: $

13. Mortgage payments
Mortgages, loans taken to purchase a property, involve regular
payments at fixed intervals and are treated as reverse annuities.
Mortgages are the reverse of annuities, because you get a lump-sum
amount as a loan in the beginning, and then you make monthly
payments to the lender.
You’ve decided to buy a house that is valued at $1 million. You
have $200,000 to use as a down payment on the house, and want to
take out a mortgage...

4. A. What would be your mortgage payment if you pay for a
$250,000 home by making a 20% down payment and then taking out a
3.74% thirty year fixed rate mortgage loan to cover the remaining
balance. All work must be shown justifying the following
answers?
Mortgage payment = _______________
B. How much total interest would you have to pay over the entire
life of the loan?
Total interest paid = __________
C. Suppose you inherit some...

2.You decide to start saving for your retirement, in 25 years
time. Today you make an initial lump sum payment of 10,000, then
decide to save 500 per semester and expect an average return of
6.6%(comp.semesterly or semiannually). How much will you have in
the end, assuming you pay the money in the beginning of each
semester? 3.Your bank has just launched a savings scheme which pays
an interest at 5.15% monthly compounded, over 10 years. If you
invest 100...

15. Mortgage payments
Mortgages, loans taken to purchase a property, involve regular
payments at fixed intervals and are treated as reverse annuities.
Mortgages are the reverse of annuities, because you get a lump-sum
amount as a loan in the beginning, and then you make monthly
payments to the lender.
You’ve decided to buy a house that is valued at $1 million. You
have $250,000 to use as a down payment on the house, and want to
take out a mortgage...

13. Mortgage payments
Mortgages, loans taken to purchase a property, involve regular
payments at fixed intervals and are treated as reverse annuities.
Mortgages are the reverse of annuities, because you get a lump-sum
amount as a loan in the beginning, and then you make monthly
payments to the lender.
You’ve decided to buy a house that is valued at $1 million. You
have $300,000 to use as a down payment on the house, and want to
take out a mortgage...

An investment will generate 10% annual return. You have $1000 of
your own money to invest and you want to make $85 per $500
invested. How much would you need to borrow and invest (In addition
to your capital) in the same investment in order to achieve your
goal, if your loan costs you 4%?
a. $1000 b. $1166.667 c. $583 d. $1.166 e. None of above

Comparing a 15 year and 30 year mortgage. Suppose you
decide to purchase a house and determine you need $250000 loan. You
research loan rates and see that you can get either a 15 year loan
for 2.75% or a 30 year loan for 4.5%. Determine
The monthly payment on each loan
The total amount of interest paid on each loan if you
pay off the loan as scheduled.
Compare the costs of the two loans.
How does the term...

Comparing a 15 year and 30 year mortgage. Suppose you
decide to purchase a house and determine you need $250000 loan. You
research loan rates and see that you can get either a 15 year loan
for 2.75% or a 30 year loan for 4.5%. Determine
The monthly payment on each loan
The total amount of interest paid on each loan if you
pay off the loan as scheduled.
Compare the costs of the two loans.
How does the term...

Suppose you invest $1000 of your own money and borrow the
maximum amount available to you on margin and also invest that
money. The initial maintenance requirement is 50%.
(10 points) What is the total amount invested?
(10 points) The asset you purchase immediately goes up 8%. What
is the return on your invested money?
(10 points) Instead of what happens in (b) above, the price of
the asset rises 16% over the first year. You pay 5% interest on...

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