You are considering a 30 year mortgage that charges 0.4% interest each month to pay off $250 000 mortgages, determine the monthly payment p that allows the loan to be paid at 360 months
p(1 - 1.004^-360)/.004 = 250000
solve for p
let me know what you got
math error is the answer othwise your given working.
To calculate the monthly payment for a 30-year mortgage, we can use the formula for the monthly payment of a fixed-rate mortgage:
P = (r * A) / (1 - (1 + r)^(-n))
Where:
P = Monthly payment
r = Monthly interest rate
A = Loan amount
n = Total number of payments
In this case, the loan amount (A) is $250,000, and the total number of payments (n) is 360 months. The monthly interest rate (r) can be calculated by dividing the annual interest rate by 12:
r = 0.4% / 100 / 12
Let's plug the values into the formula and calculate the monthly payment:
r = 0.004 / 12
A = $250,000
n = 360
P = (0.004 / 12 * $250,000) / (1 - (1 + 0.004 / 12)^(-360))
Now we can calculate the monthly payment for the mortgage.
To determine the monthly payment, we can use the formula for calculating the monthly mortgage payment:
p = (r * PV) / (1 - (1 + r)^(-n))
Where:
p = monthly payment
r = monthly interest rate
PV = present value or loan amount
n = total number of payments
First, let's calculate the monthly interest rate (r). The given interest rate is 0.4% per month, which can be written as 0.004 in decimal form.
r = 0.004
Next, substitute the values into the formula:
p = (0.004 * $250,000) / (1 - (1 + 0.004)^(-360))
Now, solve the equation to find the monthly payment (p).