Calculate the following using the data below and show your working. Amount Borrowed: $745,826.00 Initial Interest Rate:
Question:
Calculate the following using the data below and show your working.
Amount Borrowed: $745,826.00
Initial Interest Rate: 5.84%
1. Initial fortnightly payment of a 25-year mortgage using the PVA formula.
2. Fortnightly payment in Year 6 - 10 if the interest rate is increased by 2.35% after 5 years using the PVA formula.
3. Fortnightly payment from Year 11 - 15 if the interest rate is further increased by 0.8% after 10 years using the PVA formula.
4. Fortnightly payment from Year 16 – 25 if the interest rate is further increased by 1.6% after 15 years using the PVA formula.
5. Effective annual interest rate for each period: Year 1-5, Year 6-10, Year 11- 15, and Year 16-25 using the EAR formula.
Income Tax Fundamentals 2013
ISBN: 9781285586618
31st Edition
Authors: Gerald E. Whittenburg, Martha Altus Buller, Steven L Gill