Question

Question 1:

a. Kate and John are not the only people having babies. If the world’s population is 7.6 billion (currently) and grows at an annual rate of 1.1% per year, how many people will be on this planet 40 years from now?

b. John and Kate purchased a $300,000 house shortly after graduation with a great mortgage rate of 5%. Their monthly payment is $1610. With this monthly payment, it will take them 30 years to pay off the loan. How much will they actually pay for their $300,000 house (including purchase price and accumulated interest)?

c. If John and Kate pay an extra $200 per month towards their mortgage ($1810 per month), they pay off the loan in 23.5 years. How much money does this save them compared to paying the minimum ($1610/mo.) for 30 years?

d. John’s credit card has an 18% annual interest rate. He pays the minimum and maintains a balance of $10,000 on this card for a period of 7 years. What is the total interest charge that accumulates on this debt during that period?

e. The U.S. gov’t is $21.6 trillion dollars in debt. The interest rate on the National debt is ~ 1.6%. What will be the interest that accumulates on this debt for the year 2018? (this is what the U.S. gov’t must pay it’s lenders)

Answer 1