PLEASE DO THE MEMO PART ON the SECOND PICTURE.

Mortgage Analysis You are planning to purchase a house that costs $600,000. You plan to put 20% down and borrow the remainder. Based on your credit score, you believe that you will pay 4.5% on a 30-year mortgage. 1. Use function "PMT" to calculate your mortgage payment. 2. Use function "PV" to calculate the loan amount given a payment of $2,000 per month. What is the most that you can borrow? 3. Use function "RATE" to calculate the interest rate given a payment of $2,200 and a loan amount of $500,000 4. For each scenario, calculate the total interest that you will have paid once the mortgage is paid off. (There is not a function for this, enter the formula into the cell.) 5. For each scenario, calculate the total cost of the home purchase. (Down payment plus principle (loan amount) plus interest.) 6. Assume that you plan to pay an extra $200 per month on top of your mortgage payment, calculate how long it will take you to pay off the loan given the higher payment. (Use corresponding interest rate in questions 1, 2, and 3). Calculate how much interest you will pay in total? Compare this to the value that you calculated for #4. You want to determine whether or not you should save some of your money and put only 10% down on your house. Because you are only putting 10% down, lenders require that you purchase private mortgage insurance (PMI). Assume that PMI is 1% of the mortgage amount per year. 7. Calculate your total monthly payment (mortgage payment plus PMI). 8. Calculate the total cost of financing your home purchase (interest plus PMI). 9. Calculate the total cost of the home purchase. (Down payment plus principle (loan amount) plus interest plus PMI) 10. Compare this to the costs associated with a 20% down payment. Memo 1. Summarize the results of each of your calculations. 2. Discuss the interest savings associated with an extra payment of $200 per month 3. Compare the costs and benefits of a 10% down payment versus a 20% down payment. 4. Discuss Private Mortgage Insurance. What is it? Why do lenders require it? What is the benefit to the borrower? Mortgage Analysis You are planning to purchase a house that costs $600,000. You plan to put 20% down and borrow the remainder. Based on your credit score, you believe that you will pay 4.5% on a 30-year mortgage. 1. Use function "PMT" to calculate your mortgage payment. 2. Use function "PV" to calculate the loan amount given a payment of $2,000 per month. What is the most that you can borrow? 3. Use function "RATE" to calculate the interest rate given a payment of $2,200 and a loan amount of $500,000 4. For each scenario, calculate the total interest that you will have paid once the mortgage is paid off. (There is not a function for this, enter the formula into the cell.) 5. For each scenario, calculate the total cost of the home purchase. (Down payment plus principle (loan amount) plus interest.) 6. Assume that you plan to pay an extra $200 per month on top of your mortgage payment, calculate how long it will take you to pay off the loan given the higher payment. (Use corresponding interest rate in questions 1, 2, and 3). Calculate how much interest you will pay in total? Compare this to the value that you calculated for #4. You want to determine whether or not you should save some of your money and put only 10% down on your house. Because you are only putting 10% down, lenders require that you purchase private mortgage insurance (PMI). Assume that PMI is 1% of the mortgage amount per year. 7. Calculate your total monthly payment (mortgage payment plus PMI). 8. Calculate the total cost of financing your home purchase (interest plus PMI). 9. Calculate the total cost of the home purchase. (Down payment plus principle (loan amount) plus interest plus PMI) 10. Compare this to the costs associated with a 20% down payment. Memo 1. Summarize the results of each of your calculations. 2. Discuss the interest savings associated with an extra payment of $200 per month 3. Compare the costs and benefits of a 10% down payment versus a 20% down payment. 4. Discuss Private Mortgage Insurance. What is it? Why do lenders require it? What is the benefit to the borrower