A couple buys a house for $165,000 with $45,000 as a down payment.They plan to make payments twice a month (24 payments a year),with the first payment half a month from now.If they choose a 25 year amortization period and j₂ = 8%,what is the size of their mortgage payments?

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The correct answer is A. The mortgage payment can be calculated using the formula:```PMT = (P * r) / (1 - (1 + r)^(-n))```where:* PMT is the monthly payment* P is the principal (the amount of the loan)* r is the monthly interest rate (the annual interest rate divided by 12)* n is the number of paymentsIn this case, the principal is $165,000 - $45,000 = $120,000, the annual interest rate is 8%, and the number of payments is 25 years * 12 months/year * 2 payments/month = 600 payments.Plugging these values into the formula, we get:```PMT = (120000 * 0.08/12) / (1 - (1 + 0.08/12)^(-600))``````PMT = $457.18```

A Couple Buys a House for $165,000 with $45,000 as a Down