Question

Mortgage paymentsPrincipal: $210,000.00Interest MonthlyRate Payment3%$8853.5%$9434.25% $1033How much money willbe spent in interest aloneover the course of the4.25% 30-year mortgagedescribed in the table?A. $8,925B. $161,880D. $210,000C. $371,880

Answer 1

First we will solve for the total money that will be paid back (on the 4.25% plan) over 30 years, which will be:

`\begin{gathered} =30*12*\text{ \$1033} \\ =\text{ \$371,880} \end{gathered}`

Now, we will find the money spent on interest alone thus:

`\begin{gathered} =\text{ \$371880 - \$210,000} \\ =\text{ \$161,880} \end{gathered}`

The correct answer is option B.