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Exercise 9

Avg difficulty 2.5

Use a spreadsheet (not formulas) to answer problems 9 through 13 below.

Imagine you have $20,000 saved as a down payment on a house. You wish to take out a fixed-rate 30-year mortgage loan at 4% APR (remember that mortgage rates usually assume monthly compounding). If the maximum mortgage payment you can afford is $950 per month, then what is the maximum house price that you can afford?

Lee et al., Math in Society, §2.4 Loan Payments, Exercise 9

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Adapted from Math in Society © 2018–2024 Portland Community College Math Instructors. Licensed under CC BY-SA 4.0. Source: Math in Society. Imported at revision 68ee43c.