A mortgage of $192,000 is to be repaid by making payments of $1194 at the end of each month. If interest is 5.81% per annum compounded annually, what is the term of the mortgage? State your answer in years and months (from 0 to 11 months). The term of the mortgage is year(s) and month(s).

A mortgage of $192,000 is to be repaid by making payments of $1194 at the end of each month. If interest is 5.81% per annum compounded annually, what is the term of the mortgage? State your answer in years and months (from 0 to 11 months). The term of the mortgage is year(s) and month(s).

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter19: Lease And Intermediate-term Financing

Section: Chapter Questions

Problem 10P

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Concept explainers

Cost of Credit

The cost of credit is an extra amount that the borrower has to pay besides the loan amount. These credit charges may vary from loan to loan. The cost of credit includes interest charges, maintenance charges, and arrangement charges. Some of the costs are mandatorily collected by the lender based on the loan amount and tenure of the loan. The cost of credit is also called finance charges of the credit.

Question

A mortgage of $192,000 is to be repaid by making payments of $1194 at the end of each month. If interest is 5.81% per annum compounded annually, what is the term of the mortgage? State your answer in years and months (from 0 to 11 months).
The term of the mortgage is year(s) and
month(s).

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