Math Problem Statement

You want to buy a $253,000 home. You plan to pay 20% as a down payment, and take out a 30 year loan for the rest.

a) How much is the loan amount going to be?

$

b) What will your monthly payments be if the interest rate is 6%?

$

c) What will your monthly payments be if the interest rate is 7%?

$ just the answers

Solution

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Math Problem Analysis

Mathematical Concepts

Loan Calculation
Interest Rates
Amortization

Formulas

Loan Amount = Home Price - Down Payment
Monthly Payment = [P * r * (1 + r)^n] / [(1 + r)^n - 1], where P = loan amount, r = monthly interest rate, n = number of payments

Theorems

Amortization formula

Suitable Grade Level

Grades 10-12

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