Sara buys a house for $290,000. She makes a 20% down payment and finances the balance with a 30-year fixed loan at 4.2% interest compounded monthly. Sara's monthly payment is:

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Answer:

monthly payment=$322.52

Step-by-step explanation:

cost of house=$290,000

down payment= 20%

interest  monthly = 4.2%

interest rate compounded monthly so (i)=4.2/12=0.35%

months= [tex]30\times 12[/tex]=360 months

down payment = [tex]0.2\times 290000[/tex]

                         =$58000

amount to be paid(P)=$232,000

[tex]P=R\frac{(1+r)^n-1}{i}\\232000=R\frac{(1+0.0035)^{360}-1}{0.0035}\\232000=R\times 719.33[/tex]

R=$322.52

sara's monthly payment will be $322.52

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