Question: Using a $400,000, 30year monthly payment Priced Level-Adjustable Mortgage, assuming the real loan rate is 5%, with inflation rates of 5%, 6%, and 7% for

Using a $400,000, 30year monthly payment Priced Level-Adjustable Mortgage, assuming the \"real\" loan rate is 5%, with inflation rates of 5%, 6%, and 7% for years 1, 2, and 3, respectively. It is assumed that adjustments are made annually in the outstanding balance. What is the unpaid mortgage at the beginning of the third year?

$431,727.30

$435,327.37

$432,671.95

$424,469.68

None of the possible numerical answers given is correct

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