Bill's monthly payment is $1,056 per month. The principal is $100,000 at a rate of 12 1/2% for 35 years. The amount of interest for Bill's first payment is $1,011.67.

Question

Quizplus · Accepted Answer

If the principal is $100,000 and the interest rate is 12 1/2%, the yearly interest amount would be $12,500 (100,000 x 0.125). Dividing that by 12 months gives a monthly interest amount of $1,041.67, which is higher than the stated interest amount of $1,011.67 for the first payment. Therefore, the statement is false.

Bill's Monthly Payment Is $1,056 Per Month