You are buying a flat for R1 million. You don't have a deposit, and obtain a...
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You are buying a flat for R1 million. You don't have a deposit, and obtain a 100% bond to be paid off in equal monthly payments over the next 20 years. The bank charges you interest at an effective monthly rate of 0.75%. You also need to pay a bond admin fee of R75 per month. (Note: the bank calculates the interest daily, and you repay the bond in equal monthly payments over the 20 years.) What is the effective annual interest rate you are paying? [a.bcde%] What is the nominal annual interest rate the bank would have quoted you? [a.bc%] What is your monthly payment towards the bank (including the admin fee)? [Rabcd.de] What is percentage of the bond repayment (excluding the admin fee) that goes towards capital repayment in the first month? [a.bc%] You are buying a flat for R1 million. You don't have a deposit, and obtain a 100% bond to be paid off in equal monthly payments over the next 20 years. The bank charges you interest at an effective monthly rate of 0.75%. You also need to pay a bond admin fee of R75 per month. (Note: the bank calculates the interest daily, and you repay the bond in equal monthly payments over the 20 years.) What is the effective annual interest rate you are paying? [a.bcde%] What is the nominal annual interest rate the bank would have quoted you? [a.bc%] What is your monthly payment towards the bank (including the admin fee)? [Rabcd.de] What is percentage of the bond repayment (excluding the admin fee) that goes towards capital repayment in the first month? [a.bc%]
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Answer rating: 100% (QA)
a The effective annual interest rate is 914 The effective annual interest rate is the actual rate of ... View the full answer
Related Book For
Calculus Early Transcendentals
ISBN: 9781337613927
9th Edition
Authors: James Stewart, Daniel K. Clegg, Saleem Watson, Lothar Redlin
Posted Date:
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