A $300,000 mortgage at 5.8% compounded semiannually requires monthly payments that were calculated based on a 25-year amortization. Upon reviewing her budget, the borrower decides to speed up the repayment of the loan by rounding her monthly payments up to the nearest $100. How much is the rounded up monthly payment, and how much is the amortization period shortened as a result of the decision to round up the monthly payments?
A $300,000 mortgage at 5.8% compounded semiannually requires monthly payments that were calculated based on a 25-year amortization. Upon reviewing her budget, the borrower decides to speed up the repayment of the loan by rounding her monthly payments up to the nearest $100. How much is the rounded up monthly payment, and how much is the amortization period shortened as a result of the decision to round up the monthly payments?
Chapter4: Time Value Of Money
Section: Chapter Questions
Problem 25PROB
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A $300,000 mortgage at 5.8% compounded semiannually requires monthly payments that were calculated based on a 25-year amortization. Upon reviewing her budget, the borrower decides to speed up the repayment of the loan by rounding her monthly payments up to the nearest $100. How much is the rounded up monthly payment, and how much is the amortization period shortened as a result of the decision to round up the monthly payments?
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