# Unit 9 Assignment Essay

800 Words Mar 10th, 2015 4 Pages
Unit 9Assignment

Answer the following questions directly on this document. Please bold or highlight your final answer.Where needed, round to the nearest cent.

To find payment amounts, you may use Excel, the EZ Calculators app, or the tables in the Chapter if those tables have the needed values. When finding an APR, give an exact value using Excel or the EZ Calculators app. Show work.

1] A cell phone has a purchase price of \$299. The phone can be financed by putting \$100 down and paying \$20.50 a month for 12 months. Find (a) the amount financed, (b) the total monthly payments, and (c) the total finance charge.
Total selling price = \$299
Down payment = \$100
Amount financed = 299-100 = \$199
Total monthly payments =
The down payment is \$5,000 and the mortgage will be for 30 years at 5.5%. Find (a) the monthly mortgage payment, and (b) the total cost of interest.
Amount borrowed = 90,000-5,000 = \$85,000
Amortization payment factor = 5.6779
Amount of loan in thousands = 85
Monthly mortgage payment = 85*5.6779 = \$482.62
Total cost of interest = (482.62*360)-85000 = \$88,743.20

7] The selling price of a home is \$125,000. The down payment is \$5,000 and the mortgage will be for 30 years at 7%. Find (a) the monthly mortgage payment, and (b) how the first monthly payment is broken down into interest and principal.
Amount borrowed = \$120,000
Amortization payment factor = 6.6530
Amount of loan in “000” = 120
Monthly mortgage payment = 6.6530*120 = \$798.36
\$120,000 mortgage has a monthly payment of \$798.36
The monthly interest rate = 7/12 = 0.5833%; therefore, in each row below,
Monthly interest = Unpaid balance*0.005833
Principal payment = Total payment – monthly interest
Month Unpaid Balance Interest payment Principal payment Total payment New balance 1 \$120,000 \$699.96 \$98.4 \$798.36 \$119,901.60

8] Oprah Winfrey has closed on a 42-acre estate near Santa Barbara, California, for \$50,000,000. If Oprah puts 20% down and finances at 7% for 30 years, what would her monthly payment be?
Down payment = \$10,000,000
Amount borrowed = \$40,000,000