FinancingInterest_and_payment_calculationsHARD
A buyer borrows $150,000 on a 15-year fixed-rate mortgage at 6% interest. Using the standard amortization formula and rounding to the nearest dollar, what is the monthly principal-and-interest payment?
Correct Answer
A) $1,266
Using the standard amortization formula with principal of $150,000, monthly rate of 6% ÷ 12, and 180 monthly payments gives a payment of about $1,265.79. Rounded to the nearest whole dollar, the monthly principal-and-interest payment is $1,266.
Answer Options
A
$1,266B
$1,144C
$1,205D
$1,055Why This Is the Correct Answer
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Background Knowledge for Financing
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Related Topics & Key Terms
Key Terms:
monthly_payment15_year_mortgageamortization_formulafixed_rate_mortgage
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