1.

The Martinezes are planning to refinance their home (assuming that there are no additional finance charges). The outstanding balance on their original loan is $150,000. Their finance company has offered them two options:Option A: A fixed-rate mortgage at an interest rate of 6.5% per year compounded monthly, payable over a 25-year period in 300 equal monthly installments. Option B: A fixed-rate mortgage at an interest rate of 6.25% per year compounded monthly, payable over a 12-year period in 144 equal monthly installments. (a) Find the monthly payment required to amortize each of these loans over the life of the loan. (Round your answers to the nearest cent.) Option A: $ Option B: $ (b) How much interest would the Martinezes save if they chose the 12-year mortgage instead of the 25-year mortgage? Use the rounded monthly payment values from part (a). (Round your answer to the nearest cent.) $

2.

The Turners have purchased a house for$180,000. They made an initial down payment of$10,000and secured a mortgage with interest charged at the rate of10%/year compounded monthly on the unpaid balance. The loan is to be amortized over 30 yr. (Round your answers to the nearest cent.)(a) What monthly payment will the Turners be required to make? $ (b) How much total interest will they pay on the loan? $ (c) What will be their equity after 10 years? $ (d) What will be their equity after 22 years? $

3.

Find the amortization table for a$23,000loan amortized in five annual payments if the interest rate is4.3%per year compounded annually. (Round your answers to the nearest cent.)

End of Period	Payment	Payment Toward Interest	Payment Toward Principal	Outstanding Principal
0				23000
1
2
3
4
5