Narrative 14-2
for Problems in This Section, Use Table 14-1 $3 \frac { 1 } { 2 } \%$

Narrative 14-2
For problems in this section, use Table 14-1 from your text to find monthly mortgage payments.
-Refer to Narrative in your text 14-2. Willie Chirino purchased a condominium with an adjustable rate mortgage. The margin on the loan is 3.8% over the current index and the rate cap is 8% over the life of the loan.
A)If the current index is $3 \frac { 1 } { 2 } \%$ , what is the calculated interest rate of the ARM?
B)What is the maximum overall rate of the loan?