The average median 2019 price of a home here in Columbia, SC was around $145,000. That price is not bad at all (surprisingly good!!). Given that the interest on the housing loan is roughly 3.92% and the deal is over 30 years, what should you approximately expect your monthly payments to be if you decide to purchase a house here in Columbia?

The average median 2019 price of a home here in Columbia, SC was around $145,000. That price is not bad at all (surprisingly good!!). Given that the interest on the housing loan is roughly 3.92% and the deal is over 30 years, what should you approximately expect your monthly payments to be if you decide to purchase a house here in Columbia?

Managerial Economics: A Problem Solving Approach

5th Edition

ISBN:9781337106665

Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Publisher:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Chapter5: Investment Decisions: Look Ahead And Reason Back

Section: Chapter Questions

Problem 5.2IP

See similar textbooks

Similar questions

A Flexible Savings Account (FSA) plan allows you to put money into an account at the beginning of the calendar year that can be used for medical expenses. This amount is not subject to federal tax. As you pay medical expenses during the year, you are reimbursed by the administrator of the FSA until the money is exhausted. From that point on, you must pay your medical expenses out of your own pocket. On the other hand, if you put more money into your FSA than the medical expenses you incur, this extra money is lost to you. Your annual salary is $80,000 and your federal income tax rate is 30%. [1] Assume that your medical expenses in a year are normally distributed with mean $2000 and standard deviation $500. Build an @RISK model in which the output is the amount of money left to you after paying taxes, putting money in an FSA, and paying any extra medical expenses. Experiment with the amount of money put in the FSA, using a RISKSIMTABLE function. [2] Rework part a, but this time assume…
You are determined to have at least one million dollars on the day you retire. How much will you need to save each year over the next 40 years of your career in order to meet this goal of $1,000,000 assuming you put you money into an account that averages 10% each year?
A young couple has made a nonrefundable deposit of the first month's rent (equal to $1000) on a one-year apartment lease. The next day they find another apartment that they like just as well, but its monthly rent is only $900. They plan to be in the apartment for a year. Should they switch to the new apartment? Assume an (annual) interest rate of 12%. Select one: True False
You are offered a 15-year investment and ask to select your preferred terms of interest which of the following is the most profitable option if the interest rate is 8% per year. (a) continuously. (b) annually, (c) semi-annually, (d) quarterly, (e) monthly, (f) daily. SHOW YOUR COMPLETE SOLUTION, 4 DECIMAL PLACES ONLY
Josh is required to pay P57,000 in 15 days or P60,000 in 60 days. Find theannual rate of interest
A federal government contractor is considering buying a software package at a cost of $450,000. The software company will charge an annual maintenance fee of $25,000 payable at the beginning of each year including the very first year. The contracting company is bidding on a four-year government contract. The equivalent uniform annual cost of the software that should be included in the bid at an interest rate of 20% is ______.
10. Find the amount due at the end of 15 months whose present value is P2,000 at 5% simple discount. ANSWER: 2,133,33
The Tuition Prepayment Option (TPO) offered by many colleges provides savings by eliminating future tuition increases. When you enroll in the plan, you prepay all remaining undergraduate tuition and required fees at the rate in effect when you enter the plan. Tuition and fees (not including room and board) for the 2011-2012 academic year are $37,489 at Harvard University. Total undergraduate tuition for an entering freshman at this rate is $149,956. Tuition, fees, room, and board normally increase each year, but it is difficult to predict by how much, since costs depend on future economic trends and institutional priorities. The following chart lists thetuition and required fee rates since 2007: Academic Year Tuition and Fees Required Prepayment2007-2008 $31,665 $126,6602008-2009 $32,882 $131,528 2009-2010 $33,983…
Andrei wants to get a ₱20,000 loan from a bank to start a milk tea business. The loan has a 10% interest, and it must be paid within three months. If he can choose between nominal and effective interest rates, which is more profitable for him?
An investor (owner) has an option to purchase a tract of land that will be worth $10,000 in six years. If the value of the land increases at 8% each year, how much should the investor be willing to pay now for this property?
James is offered an investment opportunity with the guarantee that his investment will quadruple in 12 years. Assuming quarterly compounding, what is the nominal interest rate James is getting on this investment?
You want to open a savings plan for your future retirement. You are considering the following two options: Option 1: You deposit $1,000 at the end of each quarter for the first 10 years. At the end of 10 years, you make no further deposits, but you leave the amount accumulated at the end of 10 years for the next 15 years. Option 2: You do nothing for the first 10 years. Then you deposit $6,000 at the end of each year for the next 15 years. If your deposits or investments earn an interest rate of 6% compounded quarterly and you choose Option 2 over Option 1, then at the end of 25 years from now, you will have accumulated (a) $7,067 more. (b) $8,523 more. (c) $14,757 less. (d) $13,302 less.