Alternative 2 Results in the Lowest Overall Cost and Lowest

question 90

Essay

Alternative 2 results in the lowest overall cost and lowest interest cost.A 20 year mortgage biweekly costs $216.04/month more than a 25-year but saves $64,062 over 20 years.The cost per month of bimonthly payments is also slightly lower than monthly payments.This is a good exercise to demonstrate the advantage of shorter term mortgages.
-How long does it take $1,000 to double in value if you have a
A)3% return
B)6% return
C)10% return
Assume compounding monthly.

• A)3% return
• B)6% return
• C)10% return
• Assume compounding monthly.

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Definitions:

Labor Supply

The total hours that workers are willing and able to work at a given wage rate, reflecting how individuals respond to changes in income or working conditions.

Indifference Curve

A set of points, each point representing a combination of goods X and Y, all of which yield the same total utility.

Marginal Utility

The supplementary contentment or advantage received from the consumption of one more unit of a product or service.

Total Utility

The total satisfaction received by a consumer from consuming a certain quantity of goods or services.