Please solve question 9 only with functions
You are planning to purchase a house that costs $600,000. You plan to put 20% down and borrow the remainder. Based on your credit score, you believe that you will pay 4.5% on a 30-year mortgage. 1. Use the function "PMT" to calculate your mortgage payment. House costs 600000 Down payment 120000 PV of loan (PV) 480000 # of periods (T) 360 Periodic interest rate (r) 0.38% Payment amount (pmt) $2,432.09 2. Use the function "PV" to calculate the loan amount given a payment of $2,000 per month. What is the most that you can borrow? Payment amount (pnt) 2000 # of periods (T) 360 Periodic interest rate (c) 0.38% PV of loan (PV) $394,722.32 3. Use the function "RATE" to calculate the interest rate given a payment of $2,200 and a loan amount of $500,000. PV of loan (PV) 500000 Payment amount (pnt) 2200 # of periods (T) 360 Periodic interest rate (r) 0.28% APR 3.34% 4. For each scenario, calculate the total interest that you will have paid once the mortgage is paid off. (There is not a function for this, enter the formula into the cell.) Scenario 1 Scenario 2 Scenario 3 PV of Loan (principle) $ 480,000 $ $ 394,722 $ $ 500,000 $ Total Payments 875,552 $ 720,000 $ 792,000 $ Total Interests 275,552 120,000 192,000 5. For each scenario, calculate the total cost of the home purchase. (Down payment plus principal (loan amount) plus interest.) Down Payments Total Payments Total costs Scenario 1 $ 120,000 Scenario 2 Scenario 3 6. Assume that you plan to pay an extra $200 per month on top of your mortgage payment, calculate how long it will take you to pay off the loan given the higher payment. (Use the corresponding interest rate in questions 1, 2, and 3). Calculate how much interest you will pay in total? Compare this to the value that you calculated for the 4th question. Periodic Payment PV of Loan Periodic Rate Months Total interests Scenario 1 Scenario 2 Scenario 3 You want to determine whether you should save some of your money and put only 10% down on your house. Because you are only putting 10% down, lenders require that you purchase private mortgage insurance (PMI). Assume that PMI is 1% of the mortgage amount per year. 7. Calculate your total monthly payment (mortgage payment plus PMI). House costs 600000 Down payment 60000 PV of loan (PV) 540000 # of periods (T): 360 Periodic interest rate (r): 0.38% Payment amount (pnt): $2,736.10 PMI PMI Payment per month Total Payment per month 8. Calculate the total cost of financing your home purchase (interest plus PMI). Total costs of financing 9. Calculate the total cost of the home purchase. (Down payment plus principle (loan amount) plus interest plus PMI.) Total costs of home 10. Compare this to the costs associated with a 20% down payment. Difference You are planning to purchase a house that costs $600,000. You plan to put 20% down and borrow the remainder. Based on your credit score, you believe that you will pay 4.5% on a 30-year mortgage. 1. Use the function "PMT" to calculate your mortgage payment. House costs 600000 Down payment 120000 PV of loan (PV) 480000 # of periods (T) 360 Periodic interest rate (r) 0.38% Payment amount (pmt) $2,432.09 2. Use the function "PV" to calculate the loan amount given a payment of $2,000 per month. What is the most that you can borrow? Payment amount (pnt) 2000 # of periods (T) 360 Periodic interest rate (c) 0.38% PV of loan (PV) $394,722.32 3. Use the function "RATE" to calculate the interest rate given a payment of $2,200 and a loan amount of $500,000. PV of loan (PV) 500000 Payment amount (pnt) 2200 # of periods (T) 360 Periodic interest rate (r) 0.28% APR 3.34% 4. For each scenario, calculate the total interest that you will have paid once the mortgage is paid off. (There is not a function for this, enter the formula into the cell.) Scenario 1 Scenario 2 Scenario 3 PV of Loan (principle) $ 480,000 $ $ 394,722 $ $ 500,000 $ Total Payments 875,552 $ 720,000 $ 792,000 $ Total Interests 275,552 120,000 192,000 5. For each scenario, calculate the total cost of the home purchase. (Down payment plus principal (loan amount) plus interest.) Down Payments Total Payments Total costs Scenario 1 $ 120,000 Scenario 2 Scenario 3 6. Assume that you plan to pay an extra $200 per month on top of your mortgage payment, calculate how long it will take you to pay off the loan given the higher payment. (Use the corresponding interest rate in questions 1, 2, and 3). Calculate how much interest you will pay in total? Compare this to the value that you calculated for the 4th question. Periodic Payment PV of Loan Periodic Rate Months Total interests Scenario 1 Scenario 2 Scenario 3 You want to determine whether you should save some of your money and put only 10% down on your house. Because you are only putting 10% down, lenders require that you purchase private mortgage insurance (PMI). Assume that PMI is 1% of the mortgage amount per year. 7. Calculate your total monthly payment (mortgage payment plus PMI). House costs 600000 Down payment 60000 PV of loan (PV) 540000 # of periods (T): 360 Periodic interest rate (r): 0.38% Payment amount (pnt): $2,736.10 PMI PMI Payment per month Total Payment per month 8. Calculate the total cost of financing your home purchase (interest plus PMI). Total costs of financing 9. Calculate the total cost of the home purchase. (Down payment plus principle (loan amount) plus interest plus PMI.) Total costs of home 10. Compare this to the costs associated with a 20% down payment. Difference
