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1) Let's assume that a loan of $100,000 with an annual interest rate of 6% over 30 years pays monthly payments of $500. a. Calculate
1) Let's assume that a loan of $100,000 with an annual interest rate of 6% over 30 years pays monthly payments of $500. a. Calculate the accumulation rate (5 points) b. Calculate the payment rate (5 points). c. Answer (5 points): How will the principal balance be at the end of the loan in relation to the original amount of the loan? Less than, equal to or more? Provide calculations.
1) Let's assume that a loan of $100,000 with an annual interest rate of 6% over 30 years pays monthly payments of $500.
a. Calculate the accumulation rate (5 points)
b. Calculate the payment rate (5 points).
c. Answer (5 points): How will the principal balance be at the end of the loan in relation to the original amount of the loan? Less than, equal to or more?
Provide calculations.
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