Assume you purchased a home and borrowed $100,000 at a rate of 8% compounded monthly over 30 years. What is your monthly payment?
A) $917.77
B) $733.76
C) $666.67
D) $878.14

Question

Quizplus · Accepted Answer

The monthly payment can be calculated using the formula for a fixed-rate mortgage: M = P[r(1+r)^n]/[(1+r)^n – 1], where P is the loan principal ($100,000), r is the monthly interest rate (0.08/12), and n is the total number of payments (30*12). This calculation results in a monthly payment of approximately $733.76.

Assume You Purchased a Home and Borrowed $100,000 at a Rate