anonymous
  • anonymous
You have just grduated from college and landed youyr first job, you purchase a house cost 250,000 and find a bank interest rate 6% that compounds monthly for 30 years. what is the monthly payment for this loan? what is the unpaid balance at the end of 5 years? what is the unpaid balance at the end of the 10th year? I think I should use the formula A=p(1+I)n but I am not sure please help.
Mathematics
  • Stacey Warren - Expert brainly.com
Hey! We 've verified this expert answer for you, click below to unlock the details :)
SOLVED
At vero eos et accusamus et iusto odio dignissimos ducimus qui blanditiis praesentium voluptatum deleniti atque corrupti quos dolores et quas molestias excepturi sint occaecati cupiditate non provident, similique sunt in culpa qui officia deserunt mollitia animi, id est laborum et dolorum fuga. Et harum quidem rerum facilis est et expedita distinctio. Nam libero tempore, cum soluta nobis est eligendi optio cumque nihil impedit quo minus id quod maxime placeat facere possimus, omnis voluptas assumenda est, omnis dolor repellendus. Itaque earum rerum hic tenetur a sapiente delectus, ut aut reiciendis voluptatibus maiores alias consequatur aut perferendis doloribus asperiores repellat.
schrodinger
  • schrodinger
I got my questions answered at brainly.com in under 10 minutes. Go to brainly.com now for free help!
anonymous
  • anonymous
Yes yo do use that formula:\[C(t) = Co(1+r)^t\] Where, C(t) is the cost in the future Co is the initial cost r is the rate in decimals not % (6% = 0.06) t is the time period, in this case in years.
anonymous
  • anonymous
I have A=250.000 (1+.06) 12 A=250.000 (1.06) 12 I don't know the next step
anonymous
  • anonymous
mathmind can yo help me when you're done

Looking for something else?

Not the answer you are looking for? Search for more explanations.

More answers

anonymous
  • anonymous
why did you put 12 as your t? @btm2011, yes i'll try
anonymous
  • anonymous
I don't know should I put 30 cause thats the years
anonymous
  • anonymous
hmm not quite. Here we are making a formula of the Cost over the period of time t so,\[C(t)=250,000(1+.06)^t\]\[C(t) = 250,000(1.06)^t\] this is the formula to find the cost at any time t (which is measure in years in this problem). If we want to know the unpaid balance at the end of 5 years, what do we do?
anonymous
  • anonymous
ummm take 250,000 (1.06) 5 i divide then multiply
anonymous
  • anonymous
what are you dividing ?
anonymous
  • anonymous
250,000 with (1.06)
anonymous
  • anonymous
that's a multiplication, isn't it?
anonymous
  • anonymous
ok so 250,000 (1.06) I got 265 then I divide that by 5
anonymous
  • anonymous
nope, do you know what a exponent is ? some number to the Nth power?
anonymous
  • anonymous
no
anonymous
  • anonymous
is that the 30 years
anonymous
  • anonymous
oh heck no. that is not the formula at all for paying off a loan. that is the formula for interest.
anonymous
  • anonymous
if i can figure out how to send an attachment i will send the correct formula.
anonymous
  • anonymous
last formula is the one you use for loan payments.
1 Attachment
anonymous
  • anonymous
No, an exponent or power tells you how many times a number is multiplies by itself:\[2^2 = 2*2 = 4\]\[2^3 = 2*2*2 = 8\]\[2^4 = 2*2*2*2 = 16\] and so on.. so, what we have is:\[C(t)=250,000(1.06)^t\]in 5 years:\[C(5 years)=250,000(1.06)^{5years}\]\[C(5)= 250,000(1.06*1.06*1.06*1.06*1.06) = 334,556.39\]Hence, the unpaind balance would be: 334,556.39 - 25000 = 84556.4
anonymous
  • anonymous
that's not it ? which one is it then?
anonymous
  • anonymous
I got 8.833
anonymous
  • anonymous
this is just not right. You are answering the following question: "if you invest $250,000 at 6% compounded monthly, how much will you have in 30 years" this question says something different. "What are your monthly payments?"
anonymous
  • anonymous
@ Satellite73 yes and it then ask for the unpaid balance after 5 years and 10 years
anonymous
  • anonymous
\[PMT=\frac{250000\times \frac{.06}{12}}{(1-(1+\frac{.06}{12})^{-12\times 30}}\]
anonymous
  • anonymous
i got $1498.88 rounded. i can try again, but this sounds about right.
anonymous
  • anonymous
sio take 250000 multiply by .06 then divide by 12
anonymous
  • anonymous
as you can see the formula is a bit complicated so you have to be careful when entering it into a calculator. lots of room for mistake.
anonymous
  • anonymous
mathmind, can you please help me
anonymous
  • anonymous
do I divide .06 with 12 first then multiply the answer by 250000
anonymous
  • anonymous
that is your numerator. order does not matter. multiply by 250000 by .06 then divide by 12 or divide .06 by 12 then multiply by 250000 get the same thing
anonymous
  • anonymous
the denominator is much trickier. if you have a good calculator put it all in at once. be careful with parenthese
anonymous
  • anonymous
I don't have one with me
anonymous
  • anonymous
then you certainly cannot do this. you cannot compute these things by hand.
anonymous
  • anonymous
I have a regular one not one that you are aking if I have
anonymous
  • anonymous
what kind?
anonymous
  • anonymous
just a regular made in china hybrid power one
anonymous
  • anonymous
then you have to use lots of parentheses.
anonymous
  • anonymous
ok I am tryn but just can't get this

Looking for something else?

Not the answer you are looking for? Search for more explanations.