
Explanation:
For a 30-year mortgage:
Apply the formula:
This equals approximately $1,199.10.
So the correct answer is C.
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Q-48.2 Fabozzi gives the monthly payment of a fully-amortizing mortgage as: original balance * [i * (1 + i)^T] / [(1 + i)^T - 1] where (i) is the interest rate and (T) is the loan term. If the interest rate on a $200,000 fully amortizing mortgage loan is 6.0% on a 30-year fully-amortizing mortgage loan, what is the monthly payment?
A
$599.55
B
$1,099.55
C
$1,199.10
D
$1,99.55