Jennifer has been offered a 30-year $500,000 fixed mortgage from her bank with an interest rate...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
Jennifer has been offered a 30-year $500,000 fixed mortgage from her bank with an interest rate of 6.5%. What would be her monthly mortgage payment? 25. Sofia and Jose are both 30 and plan to invest $10,000 each year for the next 35 years for retirement. Sofia plans to invest in the Vanguard Total U.S. Stock Market Fund which she thinks will have a "gross" expected annualized return of 10.00 %. Vanguard charges a 0.05% expense ratio so its "net" expected return is 9.95%. Jose, by chance, plans to invest in the XYZ corporation's total U.S. stock market fund which also has a "gross" expected return of 10.00%. However, the XYZ fund has an expense ratio of 0.50% so its "net" expected return is accordingly lower than Sophia's fund. How much more is Sophia "expected" to have after 35 years of investing than Jose? Jennifer has been offered a 30-year $500,000 fixed mortgage from her bank with an interest rate of 6.5%. What would be her monthly mortgage payment? 25. Sofia and Jose are both 30 and plan to invest $10,000 each year for the next 35 years for retirement. Sofia plans to invest in the Vanguard Total U.S. Stock Market Fund which she thinks will have a "gross" expected annualized return of 10.00 %. Vanguard charges a 0.05% expense ratio so its "net" expected return is 9.95%. Jose, by chance, plans to invest in the XYZ corporation's total U.S. stock market fund which also has a "gross" expected return of 10.00%. However, the XYZ fund has an expense ratio of 0.50% so its "net" expected return is accordingly lower than Sophia's fund. How much more is Sophia "expected" to have after 35 years of investing than Jose?
Expert Answer:
Answer rating: 100% (QA)
1 To calculate Jennifers monthly mortgage payment we can use the formula for a fixedrate mortgage M ... View the full answer
Related Book For
Engineering Economic Analysis
ISBN: 9780195168075
9th Edition
Authors: Donald Newnan, Ted Eschanbach, Jerome Lavelle
Posted Date:
Students also viewed these finance questions
-
A manufacturing firm has been offered a component part it uses according to the following discount pricing schedule provided by the supplier: QTY_________________PRICE/UNIT 1 -...
-
The repayment plan for a loan with an interest rate of 5.0% totaling 20,500 now is to fully pay off the loan in 11 years using end of year payments beginning at 1300 and increasing by the same amount...
-
A $10 million, 5-year loan bears an interest rate of 7 percent. The loan repayment plan calls for five annual end-of-year payments. Each payment is to include an equal amount of principal repayment...
-
Consider the following independent situations found during audit testing of Faran Ltd, which has a balance date of 30 June 2019. Assume that all the situations are material. (i)Recent industrial...
-
Richardson Company is contemplating the establishment of a share-based compensation plan to provide long-run incentives for its top management. However, members of the compensation committee of the...
-
One strategy for inland cities like Denver or Phoenix to increase their water supply would be to fund desalination plants hundreds of miles away in California and trade the water for an increased...
-
Kent and Davis are partners in operating a store. Without consulting Kent. Davis enters into a con tract to purchase merchandise for the store. Kent contends that he did not authorize the order and...
-
The following transactions of Happy Music Company occurred during 2012 and 2013: Requirement 1. Record the transactions in Happy Music Companys journal. Explanations are notrequired. 2012 Purchased a...
-
Problem 6-22 (Algo) Variable Costing Income Statements; Income Reconciliation [LO6-1, LO6-2, LO6-3] Denton Company manufactures and sells a single product. Cost data for the product are given:...
-
Angus Walker, CFA, is reviewing the defined benefit pension plan of Acme Industries. Based in London, Acme has operations in North America, Japan, and several European countries. Next month, the...
-
4) a) Explain what is meant by the term 'assistive technology'. (2 marks) b) Name one disadvantage associated with the use of assistive technology. (1 mark) c) Using suitable examples, describe three...
-
DDJ Construction Co. began operations in 2021. Construction activity for 2021 is shown below. DDJ uses the cost-recovery method. Contract Billings Collections Contract Through Through Price 12/31/21...
-
Masci, Evolution Debate in the US Hall, The Fight to Keep Evolution Out of Schools World Population Review: Status of teaching evolution in the states(2022) Next Generation Science Standards-High...
-
Nigel sent a text message to BigTech requesting to buy electronic products for $8 million for delivery on November 15, 2022. The sales rep for BigTech sent a reply via email stating that she was...
-
With the last of your gold, you decide to buy a Ferrari F50 GT1.It has a maximum speed of 380 km/hour. How fast is that in MPH(miles per hour)? (Hint: 1 mile = 1.6 km)
-
Cost-benefit analysis is an approach that is widely used in decision-making as it provides a threshold for evaluating the costs and benefits for alternative options. Cost-benefit analysis allows...
-
QUESTION 2 Your firm has recently been appointed as the external auditor of Global Berhad (Global). Global has developed Saga, an online human capital management system, which includes payroll...
-
The time to assemble the first unit on a production line is 10 hours. The learning rate is 0.94. Approximately how long will it take for the seventh unit to be assembled? The number of hours needed...
-
Pollution control equipment must be purchased to remove the suspended organic material from liquid. being discharged from a vegetable packing plant. Two alternative pieces of equipment are available...
-
Explain the accounting function within a firm. What does this function do, and why is it important? What types of data does it provide?
-
The MSU football team has 10 games scheduled for next season. The business manager wishes to estimate how much money the team can be expected to have left over after paying the season's expenses,...
-
What is the purpose of the Eighth Directive of the European Union? What do you think some of these challenges hindering its total implementation might be?
-
The U.S. system leans toward a heavy education requirement mixed with practice, and the British system leans more toward a heavy experience requirement bordering on apprenticeship. Which system is...
-
If you were a certified accountant in your home country and wanted to practice as an auditor in another country, you would most likely not be allowed to practice. Why do these barriers to entry...
Study smarter with the SolutionInn App