Use a spreadsheet (not formulas) to answer problems 9 through 13 below.
Assume you take out a 30-year mortgage loan for $250,000 at a fixed 4.5% APR.
What will be the amount of your monthly payment?
After the first ten years of payments, how much will remain on your loan balance?
After the first twenty years of payments, how much will remain on your loan balance?
Notice that the amount of the loan balance reduction during the second ten years, was very considerably bigger than the amount of the loan balance reduction during the first ten years. Why does the loan balance decrease at a faster and faster pace, the longer that the loan has been in repayment?
Lee et al., Math in Society, §2.4 Loan Payments, Exercise 13