House loan Suppose you take out a home mortgage for

Chapter 11, Problem 63E

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QUESTION:

House loan Suppose you take out a home mortgage for $180,000 at a monthly interest rate of 0.5%. If you make payments of $1000 per month, after how many months will the loan balance be zero? Estimate the answer by graphing the sequence of loan balances and then obtain an exact answer.

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QUESTION:

House loan Suppose you take out a home mortgage for $180,000 at a monthly interest rate of 0.5%. If you make payments of $1000 per month, after how many months will the loan balance be zero? Estimate the answer by graphing the sequence of loan balances and then obtain an exact answer.

ANSWER:

SOLUTION

Step 1

Suppose you take out a home mortgage for $180,000 at a monthly interest rate of 0.5%. If you make payments of $1000 per month, after how many months will the loan balance be zero? Estimate the answer by graphing the sequence of loan balances and then obtain an exact answer.

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