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please solve it with formulas. please solve all parts A prospective homeowner wants to determine how mach she can borrow in the form of a

please solve it with formulas. please solve all parts image text in transcribed
A prospective homeowner wants to determine how mach she can borrow in the form of a fixed-rate 20-year mortgage. Mortgages of that maturity carry a fixed interest rate of 9.00%. She estimates that she can afford annual, pre-tax payments (interest plus principal) on her mortgage of $25,000 (for simplicity, assume that mortgage payments are made once a year at the end of the year). A. How large a mortgage can she afford, nossuming she makes steady payments of $25,000 per year for 20 years? How much total interest will be puid over the 20-year life of the mortgage? How much interest will be paid during the first year of the mortgage? How much principal will be repuid in the first year? How much of the final $25,000 payment at the end of 20 years will be interest and how much will be principal? B. Suppose the prospective hone otener expects her income to grow sudh that she could afford $25,000 per year of total debt service in the first five years of a 20-year mortgage, $30,000 per year in the second five years, $35,000 in the third five years, and $40,000 in the last five years. How large a mortgage at 9.00% could she afford under these circumstances

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