A lending agency advertises in the paper an APR of 12% on a home mortgage with a term of 30 years. The ad claims that the monthly payment on a principal of $200,000 will be $20,570. Is this claim reasonable? What should the ad have said the payment would be (to the nearest dollar)? O The ad should have said that the monthly payment is $200,000. O The claim is reasonable. The ad was correct to say that monthly payment is $20,570. O The ad should have said that the monthly payment is $2,000. O The ad should have said that the monthly payment is $2,057.

A lending agency advertises in the paper an APR of 12% on a home mortgage with a term of 30 years. The ad claims that the monthly payment on a principal of $200,000 will be $20,570. Is this claim reasonable? What should the ad have said the payment would be (to the nearest dollar)? O The ad should have said that the monthly payment is $200,000. O The claim is reasonable. The ad was correct to say that monthly payment is $20,570. O The ad should have said that the monthly payment is $2,000. O The ad should have said that the monthly payment is $2,057.

Corporate Fin Focused Approach

5th Edition

ISBN:9781285660516

Author:EHRHARDT

Publisher:EHRHARDT

Chapter4: Time Value Of Money

Section4.17: Amortized Loans

Problem 1ST

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