meepisbeast13
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House payments work the exact same way except banks usually give you 15 to 30 years to pay it off. What would your monthly payment be on a house if you took a loan out for $85,000 with an APR of 7.1% and you were going to pay it back over a term of 30 years on a monthly basis?

(Also, with houses you can expect to pay another $100 - $300 per month in taxes and insurance depending on where you live and the price of the house.)

The monthly payment is
Question Blank This means you actually pay
Blank for a house that costed $85,000 initially. *This is why it's best to pay off loans early!*

652.23 571.23 489.65 90,200.30 120,642.80 205,641.78

Respuesta :

Using simple interest, it is found that the monthly payments are of $739.00.

Simple Interest

Simple interest is used when there is a single compounding per time period.

The amount of money after t years in is modeled by:

[tex]A(t) = A(0)(1 + rt)[/tex]

In which:

  • A(0) is the initial amount.
  • r is the interest rate, as a decimal.

In this problem:

  • The loan is of A(0) = 85000.
  • The rate is of r = 0.071.
  • The term is for 30 years, hence t = 30.

Then, the total amount will be of:

[tex]A(t) = A(0)(1 + rt)[/tex]

[tex]A(t) = 85000[1 + 30(0.071)][/tex]

[tex]A(t) = 266050[/tex]

In 30 x 12 = 360 monthly payments, hence:

266050/360 = 739.

The monthly payments are of $739.00.

More can be learned about simple interest at https://brainly.com/question/25296782

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