Question 1

Use the table provided in the handbook. With a mortgage of $91,000 at 12% for 25 years, by what amount is the principal reduced the first month?

Accepted Answer

The answer of Use the table provided in the handbook....

Question 2

Points represent:

Accepted Answer

A)  2% of the amount of the loan 
B)  Monthly payments 
C)  An additional cost of receiving the mortgage 
D)  3% up-front payment 
E)  None of these 
A)  2% of the amount of the loan 
B)  Monthly payments 
C)  An additional cost of receiving the mortgage 
D)  3% up-front payment 
E)  None of these C

Question 3

Using the table in the handbook, the total cost of interest on a home purchased for $200,000 with 30% down at 7% for 35 years is $235,732.

Accepted Answer

A) True 
 B)False  True

Question 4

The reduction of principal each month is equal to the payment minus the interest.

Accepted Answer

A) True 
 B)False

Question 5

Abby's monthly payment is $781.60 per month. The principal is $80,000 at a rate of 11 1/2% for 35 years. The principal reduction after the first mortgage payment is $14.93.

Accepted Answer

A) True 
 B)False

Question 6

Chin Woo bought a home for $160,000. He put down 20%. The mortgage is at 8 1/2% for 25 years. Using the table in the handbook, his yearly payments are:

Accepted Answer

A)  $1,238.00 
B)  $12,380.16 
C)  $12,830.61 
D)  $12,380.61 
E)  None of these 
A)  $1,238.00 
B)  $12,380.16 
C)  $12,830.61 
D)  $12,380.61 
E)  None of these

Question 7

Stu Reese has a $150,000 7 ½% mortgage. His monthly payment is $1,010.10. His first payment will reduce the principal to an outstanding balance of:

Accepted Answer

A)  $149,729.40 
B)  $149,927.40 
C)  $72.60 
D)  $149,910.40 
E)  None of these 
A)  $149,729.40 
B)  $149,927.40 
C)  $72.60 
D)  $149,910.40 
E)  None of these

Question 8

All mortgages must be paid monthly.

Accepted Answer

A) True 
 B)False

Question 9

Amanda Chin purchased a home for $296,000; she put 20% down with a mortgage rate of 6% for 30 years. What is Amanda's monthly payment?

Accepted Answer

A)  $1,776 
B)  $1,402 
C)  $1,240.80 
D)  $1,420.80 
E)  None of these 
A)  $1,776 
B)  $1,402 
C)  $1,240.80 
D)  $1,420.80 
E)  None of these

Question 10

Dick Hercher bought a home in Homewood, Illinois, for $230,000. He put down 20% and obtained a mortgage for 25 years at 8%. The total interest cost of the loan is:

Accepted Answer

A)  $184,000.00 
B)  $327,372.80 
C)  $242,411.00 
D)  $242,144.00 
E)  None of these 
A)  $184,000.00 
B)  $327,372.80 
C)  $242,411.00 
D)  $242,144.00 
E)  None of these

Question 11

Graduated payments let the borrower pay more at the beginning of the mortgage and make lower payments later.

Accepted Answer

A) True 
 B)False

Question 12

Jill Diamond bought a home for $190,000 with a down payment of $65,000. The rate of interest was 7% for 35 years. Her monthly mortgage payment is:

Accepted Answer

A)  $843.75 
B)  $834.57 
C)  $798.75 
D)  $978.57 
E)  None of these 
A)  $843.75 
B)  $834.57 
C)  $798.75 
D)  $978.57 
E)  None of these

Question 13

An amortization schedule shows:

Accepted Answer

A)  Balance of interest outstanding 
B)  The increase to principal 
C)  Increase in loan outstanding 
D)  Portion of payment broken down to interest and principal 
E)  None of these 
A)  Balance of interest outstanding 
B)  The increase to principal 
C)  Increase in loan outstanding 
D)  Portion of payment broken down to interest and principal 
E)  None of these

Question 14

Megan Mei is charged 2 points on a $120,000 loan at the time of closing. The original price of the home before the down payment was $140,000. The points in dollars cost Megan:

Accepted Answer

A)  $2,400 
B)  $2,800 
C)  $4,200 
D)  $8,200 
E)  None of these 
A)  $2,400 
B)  $2,800 
C)  $4,200 
D)  $8,200 
E)  None of these

Question 15

A monthly payment of $850 on a 30-year $80,000 mortgage results in a total cost of interest of $226,000.

Accepted Answer

A) True 
 B)False

Question 16

From the table in the handbook, the monthly payment on a home purchased for $150,000 with 30% down at 13% for 30 years is $1,132.53.

Accepted Answer

A) True 
 B)False

Question 17

Bill's monthly payment is $1,056 per month. The principal is $100,000 at a rate of 12 1/2% for 35 years. The amount of interest for Bill's first payment is $1,011.67.

Accepted Answer

A) True 
 B)False

Question 18

Abe Aster bought a new split level for $200,000. Abe put down 30%. Assuming a rate of 11 1/2% on a 30-year mortgage, Abe's monthly payment is (use the table in the handbook):

Accepted Answer

A)  $1,423.80 
B)  $1,387.40 
C)  $1,367.80 
D)  $1,982.00 
E)  None of these 
A)  $1,423.80 
B)  $1,387.40 
C)  $1,367.80 
D)  $1,982.00 
E)  None of these

Question 19

Use the table provided in the handbook. Marsh Terban bought a home for $120,000 with a down payment of $30,000. Her rate of interest is 12 1/2% for 35 years. Calculate her (A) monthly payment, (B) first payment broken down into interest and principal, and (C) balance of mortgage at the end of the month.
A. $950.40;
B. $937.50 interest, $12.90 principal;
C. $89,987.10

Accepted Answer

The answer of Use the table provided in the handbook....

Question 20

Interest rates on mortgages do not vary from bank to bank.

Accepted Answer

A) True 
 B)False

Use the table provided in the handbook. With a mortgage of $91,000 at 12% for 25 years, by what amount is the principal reduced the first month?

Points represent:

Using the table in the handbook, the total cost of interest on a home purchased for $200,000 with 30% down at 7% for 35 years is $235,732.

The reduction of principal each month is equal to the payment minus the interest.

Abby's monthly payment is $781.60 per month. The principal is $80,000 at a rate of 11 1/2% for 35 years. The principal reduction after the first mortgage payment is $14.93.

Chin Woo bought a home for $160,000. He put down 20%. The mortgage is at 8 1/2% for 25 years. Using the table in the handbook, his yearly payments are:

Stu Reese has a $150,000 7 ½% mortgage. His monthly payment is $1,010.10. His first payment will reduce the principal to an outstanding balance of:

All mortgages must be paid monthly.

Amanda Chin purchased a home for $296,000; she put 20% down with a mortgage rate of 6% for 30 years. What is Amanda's monthly payment?

Dick Hercher bought a home in Homewood, Illinois, for $230,000. He put down 20% and obtained a mortgage for 25 years at 8%. The total interest cost of the loan is:

Graduated payments let the borrower pay more at the beginning of the mortgage and make lower payments later.

Jill Diamond bought a home for $190,000 with a down payment of $65,000. The rate of interest was 7% for 35 years. Her monthly mortgage payment is:

An amortization schedule shows:

Megan Mei is charged 2 points on a $120,000 loan at the time of closing. The original price of the home before the down payment was $140,000. The points in dollars cost Megan:

A monthly payment of $850 on a 30-year $80,000 mortgage results in a total cost of interest of $226,000.

From the table in the handbook, the monthly payment on a home purchased for $150,000 with 30% down at 13% for 30 years is $1,132.53.

Bill's monthly payment is $1,056 per month. The principal is $100,000 at a rate of 12 1/2% for 35 years. The amount of interest for Bill's first payment is $1,011.67.

Abe Aster bought a new split level for $200,000. Abe put down 30%. Assuming a rate of 11 1/2% on a 30-year mortgage, Abe's monthly payment is (use the table in the handbook):

Interest rates on mortgages do not vary from bank to bank.

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Discounts: Trade and Cash

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Compound Interest and Present Value

Annuities and Sinking Funds

Installment Buying

How to Read, Analyze, and Interpret Financial Reports

Depreciation

Inventory and Overhead

Sales, Excise, and Property Taxes

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Exam 15: The Cost of Home Ownership

Use the table provided in the handbook. With a mortgage of $91,000 at 12% for 25 years, by what amount is the principal reduced the first month?

Points represent:

Using the table in the handbook, the total cost of interest on a home purchased for $200,000 with 30% down at 7% for 35 years is $235,732.

The reduction of principal each month is equal to the payment minus the interest.

Abby's monthly payment is $781.60 per month. The principal is $80,000 at a rate of 11 1/2% for 35 years. The principal reduction after the first mortgage payment is $14.93.

Chin Woo bought a home for $160,000. He put down 20%. The mortgage is at 8 1/2% for 25 years. Using the table in the handbook, his yearly payments are:

Stu Reese has a $150,000 7 ½% mortgage. His monthly payment is $1,010.10. His first payment will reduce the principal to an outstanding balance of:

All mortgages must be paid monthly.

Amanda Chin purchased a home for $296,000; she put 20% down with a mortgage rate of 6% for 30 years. What is Amanda's monthly payment?

Dick Hercher bought a home in Homewood, Illinois, for $230,000. He put down 20% and obtained a mortgage for 25 years at 8%. The total interest cost of the loan is:

Graduated payments let the borrower pay more at the beginning of the mortgage and make lower payments later.

Jill Diamond bought a home for $190,000 with a down payment of $65,000. The rate of interest was 7% for 35 years. Her monthly mortgage payment is:

An amortization schedule shows:

Megan Mei is charged 2 points on a $120,000 loan at the time of closing. The original price of the home before the down payment was $140,000. The points in dollars cost Megan:

A monthly payment of $850 on a 30-year $80,000 mortgage results in a total cost of interest of $226,000.

From the table in the handbook, the monthly payment on a home purchased for $150,000 with 30% down at 13% for 30 years is $1,132.53.

Bill's monthly payment is $1,056 per month. The principal is $100,000 at a rate of 12 1/2% for 35 years. The amount of interest for Bill's first payment is $1,011.67.

Abe Aster bought a new split level for $200,000. Abe put down 30%. Assuming a rate of 11 1/2% on a 30-year mortgage, Abe's monthly payment is (use the table in the handbook):

Interest rates on mortgages do not vary from bank to bank.

Whole Numbers: How to Dissect and Solve Word Problems

Fractions

Decimals

Banking

Solving for the Unknown: a How-To Approach for Solving Equations

Percents and Their Applications

Discounts: Trade and Cash

Markups and Markdowns: Perishables and Breakeven Analysis

Payroll

Simple Interest

Promissory Notes, Simple Discount Notes, and the Discount Process

Compound Interest and Present Value

Annuities and Sinking Funds

Installment Buying

How to Read, Analyze, and Interpret Financial Reports

Depreciation

Inventory and Overhead

Sales, Excise, and Property Taxes

Filters