Which of the Following Statements Regarding a 30-Year Monthly Payment

question 101

Multiple Choice

Which of the following statements regarding a 30-year monthly payment amortized mortgage with a nominal interest rate of 10% is CORRECT?

• A) The monthly payments will decline over time.
• B) A smaller proportion of the last monthly payment will be interest,and a larger proportion will be principal,than for the first monthly payment.
• C) The total dollar amount of principal being paid off each month gets smaller as the loan approaches maturity.
• D) The amount representing interest in the first payment would be higher if the nominal interest rate were 7% rather than 10%.
• E) Exactly 10% of the first monthly payment represents interest.