Consider the following loan. Complete parts? (a)-(c) below. An individual borrow

Question

Consider the following loan. Complete parts? (a)-(c) below. An individual borrowed ?$77 comma 000 at an APR of 3?%, which will be paid off with monthly payments of ?$412 for 21 years. a. Identify the amount? borrowed, the annual interest? rate, the number of payments per? year, the loan? term, and the payment amount. The amount borrowed is ?$ 77,000.00?, the annual interest rate is 3?%, the number of payments per year is 12?, the loan term is 21 ?years, and the payment amount is ?$ 412.00. b. How many total payments does the loan? require? What is the total amount paid over the full term of the? loan? There are nothing payments toward the loan and the total amount paid is ?$ nothing.

Explanation / Answer

Principal Loan Amount, P = $77,000

Interest rate per period, r = 3% / 12 payments per year = 0.03 / 12 = 0.0025

Monthly payment, A = $412,

no. of payments per year, t = 12

The total number of payment periods, n = 21x12 = 252

Total amount paid over the full term, Amount = 412 x 252 = $103,824

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