JoyDivision
Is Big In Japan
Hello All.
A friend and I are absolutley stumped on this question because our answers arent matching up to Mr. Textbook. So heres the steps ive been taking with the question - any help would be totally and utterly appreciated.
'A Single Income family has saved $24,000 towards the cost of a home unit which they are able to purchse for $110,000'
A) How much will they have to borrow (at least?) = $86,000
B) The interest rate on the loan is 7.30% p.a. and they are advised to take the loan over 25 years
i) How much will each monthy installement be? (The problem question)
The steps I am taking -
1) N=M [ (1+r) n - 1]
------------------
r (1 + r ) n
2) N = $86,000
r = 0.0061 (7.30 divided by 12)
n = 300 (12 times 25)
3) 86,000 = M [ (1+ 0.0061) 300 - 1 ]
----------------------------
0.0061 (1 + 0.0061) 300
4) M = 86,000 x 0.0061 (1.0061) 300
--------------------------------------
(1.0061) 300 - 1
ANSWER = $523.60
The textbook says the answer is $624.39
Could you please help in any way, shape or form? This question is driving me crazy.
A friend and I are absolutley stumped on this question because our answers arent matching up to Mr. Textbook. So heres the steps ive been taking with the question - any help would be totally and utterly appreciated.
'A Single Income family has saved $24,000 towards the cost of a home unit which they are able to purchse for $110,000'
A) How much will they have to borrow (at least?) = $86,000
B) The interest rate on the loan is 7.30% p.a. and they are advised to take the loan over 25 years
i) How much will each monthy installement be? (The problem question)
The steps I am taking -
1) N=M [ (1+r) n - 1]
------------------
r (1 + r ) n
2) N = $86,000
r = 0.0061 (7.30 divided by 12)
n = 300 (12 times 25)
3) 86,000 = M [ (1+ 0.0061) 300 - 1 ]
----------------------------
0.0061 (1 + 0.0061) 300
4) M = 86,000 x 0.0061 (1.0061) 300
--------------------------------------
(1.0061) 300 - 1
ANSWER = $523.60
The textbook says the answer is $624.39
Could you please help in any way, shape or form? This question is driving me crazy.