1. You just invested $5,000 in a 48-month certificate of deposit (CD) at your local...
50.1K
Verified Solution
Link Copied!
Question
Accounting
1. You just invested $5,000 in a 48-month certificate of deposit (CD) at your local bank. The CD pays 1.5% interest per year compounded monthly. What amount will your CD be worth when it matures?
2. I am asking a bank to lend me part of the money I need to make a down payment on a duplex I am purchasing. Based on my income projections for the duplex, I can easily afford to pay $700 per month for the next four years. How much will the bank lend me, assuming it requires a 6% annual return on this four-year loan?
3. You have just entered into a contract to purchase a home. After shopping around, you decide on a $180,000 mortgage from a lender offering a 30-year fixed rate mortgage with monthly payments at an annual interest rate of 7%. What is the monthly loan payment?
4. In 2006 Juan and Maria purchased a home for $250,000. They were offered a 30-year loan by a mortgage broker for no money down, interest only for the first three years at 3%, then automatically converting to an amortizing loan at 2 points above the prime rate (the prime rate is now 5%). What was their initial monthly payment, and what did it become after the reset?
5. What does the loan adjustment in problem 4 tell you about the financial crisis in the housing market in 2009?
Answer & Explanation
Solved by verified expert
Get Answers to Unlimited Questions
Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!
Membership Benefits:
Unlimited Question Access with detailed Answers
Zin AI - 3 Million Words
10 Dall-E 3 Images
20 Plot Generations
Conversation with Dialogue Memory
No Ads, Ever!
Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
