Essentials Of Investments
Essentials Of Investments
11th Edition
ISBN: 9781260013924
Author: Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher: Mcgraw-hill Education,
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Concept explainers

Mortgages
A mortgage is a formal agreement in which a bank or other financial institution lends cash at interest in return for assuming the title to the debtor's property, on the condition that the obligation is paid in full.
Mortgage
The term "mortgage" is a type of loan that a borrower takes to maintain his house or any form of assets and he agrees to return the amount in a particular period of time to the lender usually in a series of regular equally monthly, quarterly, or half-yea…
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 What can be understood from annual percentage rate (APR)? 

Expert Solution
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Step 1

Annual percentage rate (APR):

The yearly rate charged for borrowing or picked up from speculation is an annual percentage rate (APR). The APR is communicated as a rate reflecting the entire normal cost of the reserves over a credit period. It covers any punishments or other costs related to the deal but does not incorporate the compounding.

Step 2

Given that advances or credit assertions can vary in terms of coupon rate structure, preparing costs, late punishments, and other factors, a standardized calculation such as the APR gives borrowers with a bottom-line sum that they can effectively compare to other loan specialists 'charges.

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