Question
The Drew family purchased a villa on the outskirts of the city for $1,200,000. They made a down payment of 20% of the value and
The Drew family purchased a villa on the outskirts of the city for $1,200,000. They made a down payment of 20% of the value and received a mortgage for the balance for a period of 20 years. The interest rate was fixed at 4.10% compounded semi-annually for a three-year period.
a. Calculate the monthly payment amount.
Round to the nearest cent
b. Calculate the principal balance at the end of the three-year term.
Round to the nearest cent
c. Calculate the size of the monthly payment if the mortgage is renewed for another three-year fixed term at 3.60% compounded semi-annually.
Round to the nearest cent
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