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You want to buy a house that costs $400,000. You have $50,000 in cash and want to finance the balance with a mortgage. A bank
You want to buy a house that costs $400,000. You have $50,000 in cash and want to finance the balance with a mortgage. A bank has offered to lend you money on the condition that it is repaid in 15 equal payment at the end of each year for the next 15 years. The mortgage rate will be 8% per annum. The annual amount (to the nearest dollar) that you will have to pay is
(a) $26,667
(b) $58,418
(c) $40,893
(d) $23,333
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