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Given: Sales Price: $250,000 Marginal Tax Rate 30% Property Taxes (monthly) 200 Insurance (monthly) 50 Cost to Rent an Apt. 1,000 Down Payment 20% Mortgage
Given:
Sales Price: $250,000
Marginal Tax Rate 30%
Property Taxes (monthly) 200
Insurance (monthly) 50
Cost to Rent an Apt. 1,000
Down Payment 20%
Mortgage Interest Rate 7.5%
Amortization Period 30 yrs.
What are the financial implications of renting or buying a home given the above data? Calculate on a monthly basis. (Hint: What is the after tax cost of buying the home compared to renting the apt?)
If possible, please use a financial calculator and show me how to solve as I need to learn this concept for this class.
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