QUESTION $28$

Suppose a farm couple has the option to purchase $400$ acres of land. Assume they are able to purchase the land for $$4,\frac{000}{?}$ acre. Assume a $25\%$ down payment with the balance financed by a $30$ year loan with a $7\%$ interest rate and equal annual principal payments. What will their interest charge in year $3$ be$?$

a$.$ $$84,000$

b$.$ $$81,200$

c$.$ $$40,000$

d$.$ $$78,400$

QUESTION $29$

Suppose a farm couple has the option to purchase $400$ acres of land. Assume they are able to purchase the land for $$4,\frac{000}{?}$ acre. Assume a $25\%$ down payment with the balance financed by a $30$ year loan with a $7\%$ interest rate and equal annual principal payments. What will their interest charge in year $2$ be$?$

a$.$ $$40,000$

b$.$ $$81,200$

c$.$ $$78,400$

d$.$ $$84,000$