SECTION 6.5 PROBLEM SET: MISCELLANEOUS APPLICATION PROBLEMS For problems 1 - 4, assume a $200,000 house loan is amortized over 30 years at an interest rate of 5.4% 2) Find the balance owed after 20 years. Find the monthly payment. 3) Find the he of the loan after 100 4) Find the monthly payment if the original loan payments. were amortized over 15 years. 5) fMr. Patel wants to pay off his car lpan. The 6) An amount of $2000 is borrowed for a year at monthly payment for his car is $36%, and he a rate of 7%. Make an amortization schedule has 16 payments left. If the loan wa showing the monthly payment, the monthly financed at 6.5%, how much does hd owe? interest on the outstanding balance, the portion of the payment going toward reducing the debt, and the balance. SECTION 6.5 PROBLEM SET: MISCELLANEOUS APPLICATION PROBLEMS Fourteen months after Dan bought his new car 8) You have a choice of either receiving $5,000 at he lost his job. His car was repossessed by his the end of each year for the next 5 years or lender after he made only 14 monthly payments receiving $3000 per year for the next 10 years. of $376 each. If the loan was financed over a If the current interest rate is 9%, which is 4-year period at an interest rate of .3%, how better? much did the car cost the lender?/In other words, how much did Dan still owe on the car? 9) Mr. Smith is planning to retire in 25 years and 10) Assume Mr. Smith has reached retirement and would like to have $250,000 then. What has $250,000 in an account which is earning monthly payment made at the end of each 6.5%. He would now like to make equal month to an account that pays 6.5% will monthly withdrawals for the next 15 years to achieve his objective? completely deplete this account. Find the withdrawal payment. 1 1) Mrs. Garcia is planning to retire in 20 years 12) Assume Mrs. Garcia has reached retirement and She starts to save for retirement by depositing has accumulated the amount found in question $2000 each quarter into a retirement investment 13 in a retirement savings account. She would account that earns 6% interest compounded now like to make equal monthly withdrawals quarterly. Find the accumulated value of her for the next 15 years to completely deplete this retirement savings at the end of 20 years. account. Find the withdrawal payment. Assume the account now pays 5.4% compounded monthly