Question

You have just been approved for a 30 year 6.0% fixed home mortgage. The monthly payment that you qualify for is $1112.10. Use the table provided to determine the price of a home that can be purchased. Round your answer to the nearest cent. / a. $183,147 c. $185,350 b. $184,789 d. $186,523

Answer 1

$185350 :)

Explanation:

Answer 2

$185350 is the correct answer.

Explanation:

The formula for EMI is :

`(p*r*(1+r)^(n))/((1+r)^(n)-1 )`

Lets suppose the principle amount be = p

rate or r = 6/12/100=0.005

EMI = $1112.10

Time or n = 30*12 = 360

Now, putting these values in formula,

`1112.10=(p*0.005*(1.005)^(360) )/((1.005)^(360)-1 )`

`1112.10=(0.005p*6.0225)/(5.0225)`

`1112.10*5.0225=0.03011p`

p = $185503.89

So, the principle amount becomes $185503.89

This is closest to $185350, so this is the correct answer.