Question

Asked Sep 16, 2019

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a. What will be the monthly payment on a 30-year, $250,000 mortgage loan, where the interest rate is 6% per year, compounded monthly? How much interest is paid over the life of the loan?

b. What will be the monthly payment on a 30-year, $250,000 mortgage loan, where the interest rate is 6% per year, compounded continuously? How much interest is paid over the life of the loan?

c. What will be the monthly payment on a 15-year, $250,000 mortgage loan, where the interest rate is 6% per year, compounded monthly? How much interest is paid over the life of the loan?

Step 1

**Calculation of Monthly Payment and Interest Paid on the Loan:**

**Excel Spreadsheet:**

Step 2

**Excel Workings:**

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