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loss calculation A mortgage loan is granted for the sum of $97,000 at an interest rate of 7.5% with a maturity of 30 years. But
loss calculation
A mortgage loan is granted for the sum of $97,000 at an interest rate of 7.5% with a maturity of 30 years. But one of the components of the nominal rate was underestimated, which should have been 9% (due to unexpected inflation). The loan is fully amortized.
a. What is the amount of the monthly mortgage payment as granted? 5 points b. Calculate the dollar magnitude of the loss to the lender over the 30-year period. 5 points c. Express the loss as a percentage. 5 points
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