Your annual gross (pre-tax) salary is $67,000. You can obtain a 30-year fixed rate mortgage at annual percentage rate (or APR) of 6.0%. You have $5,000 in other annual pre-tax income. You also have to pay $750 per month on an auto loan and student loans. What is the most expensive home you can buy under these circumstances?

5. What is the amount of total interest paid over the entire 30-year term of the mortgage if you purchase the most expensive house you can afford as suggested by the previous problems? (Hint: Total interest paid = total number of monthly payments over 30 years x amount of monthly payment initial mortgage principal.)

A. $269,297

B. $272,424

C. $285,515

D. $293,736