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The table shows the terms of a fixed-rate mortgage.

\begin{tabular}{|l|l|}
\hline
\multicolumn{1}{|c|}{Component} & \multicolumn{1}{c|}{Cost} \\
\hline
(P) Principal & [tex]$\$[/tex]200,000[tex]$ \\
\hline
(R) Monthly interest rate & $[/tex]4\%[tex]$ \\
\hline
\begin{tabular}{l}
(n) Total number of \\
monthly payments (30- \\
year term)
\end{tabular} & 360 \\
\hline
(M) Monthly payment & \\
\hline
\end{tabular}

Which accurately describes the terms of this mortgage? Check all that apply.

A. The homeowner is borrowing $[/tex]\[tex]$360,000$[/tex].
B. The monthly interest rate is 4 percent.
C. Monthly payments must be made for 30 years.
D. The annual interest rate is 4.8 percent.
E. The homeowner is borrowing [tex]$\$[/tex]200,000$.
F. Monthly payments must be made for 360 years.

Sagot :

GinnyAnswer
Let's carefully analyze the terms of the fixed-rate mortgage presented in the table and determine the accuracy of each statement.

Given:
- Principal (P): \[tex]$200,000 - Monthly interest rate (R): 4% - Total number of monthly payments (n) for a 30-year term: 360 Statements: 1. The homeowner is borrowing \$[/tex]360,000.
- This statement is false as the principal amount borrowed is \[tex]$200,000, not \$[/tex]360,000.

2. The monthly interest rate is 4 percent.
- This statement is true as the given monthly interest rate in the table is 4%.

3. Monthly payments must be made for 30 years.
- This statement is true. Since the total number of monthly payments is 360, and there are 12 months in a year, this amounts to a 30-year term (30 * 12 = 360).

4. The annual interest rate is 4.8 percent.
- This statement is false. There is no information provided about the annual interest rate. Moreover, if the monthly interest rate is 4%, then the annual interest rate would likely be calculated differently (typically it would be higher because of compounding).

5. The homeowner is borrowing \[tex]$200,000. - This statement is true as it matches the principal amount provided in the table. 6. Monthly payments must be made for 360 years. - This statement is false. Monthly payments must be made for 360 months, which is equivalent to 30 years, not 360 years. Conclusion: The accurate descriptions of the terms of this mortgage are: - The monthly interest rate is 4 percent. - Monthly payments must be made for 30 years. - The homeowner is borrowing \$[/tex]200,000.

So, the correct answer would include statements 2, 3, and 5:
- The monthly interest rate is 4 percent.
- Monthly payments must be made for 30 years.
- The homeowner is borrowing \$200,000.
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