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please answer maths question 10-A rental property was purchased worth $175,000. The owner has obtained a low interest rate of 3.15% compounded semi-annually for a
please answer maths question
10-A rental property was purchased worth $175,000. The owner has obtained a low interest rate of 3.15% compounded semi-annually for a 5 year term. She also plans to amortize the mortgage over a period of 20 years. b) Determine the size of the monthly payments. ($981.93) c) Determine the interest cost over the 20 years assuming nothing changes during this time. ($60,663.20) d) What is the outstanding balance at the end of the 5 years term? ($140,914.50, $140,914.23 if rounded value used for payment) e) How much principal has been paid during the first 5 years? ($34,085.50) f) How much interest has been paid during the first 5 years? ($24,830.03) g) How much interest would be saved if she decided to amortize the mortgage over a period of 15 years instead of 20 years? Hint: Find payment size first. (Assume that the interest rate does not change over the amortization periods) 10-A rental property was purchased worth $175,000. The owner has obtained a low interest rate of 3.15% compounded semi-annually for a 5 year term. She also plans to amortize the mortgage over a period of 20 years. b) Determine the size of the monthly payments. ($981.93) c) Determine the interest cost over the 20 years assuming nothing changes during this time. ($60,663.20) d) What is the outstanding balance at the end of the 5 years term? ($140,914.50, $140,914.23 if rounded value used for payment) e) How much principal has been paid during the first 5 years? ($34,085.50) f) How much interest has been paid during the first 5 years? ($24,830.03) g) How much interest would be saved if she decided to amortize the mortgage over a period of 15 years instead of 20 years? Hint: Find payment size first. (Assume that the interest rate does not change over the amortization periods) Step by Step Solution
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