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In order to purchase a home, a family borrows [tex]$\$159,000$[/tex] at [tex]6.5\%[/tex] for 30 years. Use the table to find their monthly payment. Round the answer to the nearest cent.

Monthly Payments per [tex]$\[tex]$1000$[/tex][/tex] of Mortgage:

\begin{tabular}{c|c|c|c|c|}
\hline
\begin{tabular}{l}
Interest \\
Rate (\%)
\end{tabular} & 10 Years & 20 Years & 30 Years & 40 Years \\
\hline
5.0 & 10.61 & 6.60 & 5.37 & 4.83 \\
\hline
5.5 & 10.86 & 6.88 & 5.68 & 5.16 \\
\hline
6.0 & 11.11 & 7.17 & 6.00 & 5.51 \\
\hline
6.5 & 11.36 & 7.46 & 6.33 & 5.86 \\
\hline
\end{tabular}

a. [tex]$\$954.00$[/tex]
b. [tex]$\[tex]$1,006.47$[/tex][/tex]
c. [tex]$\$1,186.14$[/tex]
d. [tex]$\[tex]$1,276.36$[/tex][/tex]

Please select the best answer from the choices provided.

A.



Answer :

GinnyAnswer
To determine the monthly payment for the given mortgage, follow these steps:

1. Find the information for the loan:
- Loan amount: \[tex]$159,000 - Interest rate: 6.5% - Term: 30 years 2. Refer to the provided table: | Interest Rate (%) | 10 Years | 20 Years | 30 Years | 40 Years | |-------------------|----------|----------|----------|----------| | 5.0 | 10.61 | 6.60 | 5.37 | 4.83 | | 5.5 | 10.86 | 6.88 | 5.68 | 5.16 | | 6.0 | 11.11 | 7.17 | 6.00 | 5.51 | | 6.5 | 11.36 | 7.46 | 6.33 | 5.86 | 3. Locate the monthly payment per \$[/tex]1000 of the mortgage for a 30-year term at a 6.5% interest rate:
- According to the table, this value is \[tex]$6.33. 4. Calculate the total monthly payment: - Divide the loan amount by 1000 to determine the number of units: \[ \frac{\$[/tex]159,000}{1000} = 159
\]
- Multiply the number of units by the monthly payment per \[tex]$1000: \[ 159 \times 6.33 = 1007.67 \] 5. Round the monthly payment to the nearest cent: \[ 1007.67 \rightarrow 1007.67 \] Note that since we're required to select from multiple choices provided and the closest accurate value here is \$[/tex]1006.47 by comparing manually given that it's a generated table with slight constant variances possibly.

6. Compare the calculated monthly payment with the given choices:
a. \[tex]$954.00 b. \$[/tex]1006.47
c. \[tex]$1186.14 d. \$[/tex]1276.36

The monthly payment of \[tex]$1007.67 is closest to option: b. \$[/tex]1006.47

Therefore, the best answer from the choices provided is:
[tex]\[ \boxed{\$1006.47} \][/tex]

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