You pay 10% down on a home with a purchase price of $280,000.Your bank will loan the remaining balance of $252,000 at 8.23% APR.You have an option to make annual payments or monthly payments on the loan.Both options have a 30-year payment schedule.What are the annuity payments under the annual plan? What are the annuity payments under the monthly plan? In terms of the total cash outflows and the effective cost of borrowing,briefly compare both plans.

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The Answer of You pay 10% down on a home with a purchase price of $280,000.Your bank will loan the remaining balance of $252,000 at 8.23% APR.You have an option to make annual payments or monthly payments on the loan.Both options have a 30-year payment schedule.What are the annuity payments under the annual plan? What are the annuity payments under the monthly plan? In terms of the total cash outflows and the effective cost of borrowing,briefly compare both plans.

You Pay 10% Down on a Home with a Purchase