1. Theresa and Paul purchased a house 5 years ago for $300,000. They made a down payment of 10% of the purchase price and secured a 30-year ARM loan at 6% per year compounded monthly. Currently, the interest rate for their ARM is 4.5% per year compounded monthly, and their monthly payments are due to be reset. What will be the new monthly payment once their payments reset? The house is now worth $500,000. How much equity do Theresa and Paul have after 5 years?

2. The Pirerras are planning to go to Europe for their daughter's 18th birthday and have agreed to set aside $250 a month for their trip. They plan to deposit this money at the end of each month into a savings account paying interest at the rate of 3% per year compounded monthly. If their daughter just turned 14, how much money will be in their travel fund when she turns 18?

3. The outstanding balance on Bill's credit card is $4500. The bank issuing the credit card is charging 8.3% per year compounded monthly. If Bill decides to pay off this balance in equal monthly install- ments at the end of each month for the next 18 months, how much will his monthly payment be? What is the effective rate of interest the bank is charging Bill?

4. A sum of $24,000 is to be repaid over a 5-year period through equal installments made at the end of every year with an interest rate of 15% per year compounded annually. Fill in the next row of the amortization schedule. Round each answer to 2 decimal places.

Theresa and Paul purchased a house 5 years ago for $300,000. They made a down payment of 10% of the purchase price and secured a 30 -year ARM loan at 6% per year compounded monthly. Currently, the interest rate for their ARM is 4.5% per year compounded monthly, and their monthly payments are due to be reset. What will be the new monthly payment once their payments reset? The house is now worth $500,000. How much equity do Theresa and Paul have after 5 years? The Pirerras are planning to go to Europe for their daughter's 18 th birthday and have agreed to set aside $250 a month for their trip. They plan to deposit this money at the end of each month into a savings account paying interest at the rate of 3% per year compounded monthly. If their daughter just turned 14, how much money will be in their travel fund when she turns 18 ? The outstanding balance on Bill's credit card is $4500. The bank issuing the credit card is charging 8.3% per year compounded monthly. If Bill decides to pay off this balance in equal monthly installments at the end of each month for the next 18 months, how much will his monthly payment be? What is the effective rate of interest the bank is charging Bill? A sum of $24,000 is to be repaid over a 5-year period through equal installments made at the end of every year with an interest rate of 15% per year compounded annually. Fill in the next row of the amortization schedule. Round each answer to 2 decimal places