Mortgages Are Annuities in That a Fixed Monthly Fixed Amount

question 32

Multiple Choice

Mortgages are annuities in that a fixed monthly fixed amount to the lender (assume monthly payments and an interest rate that compounds semi-annually) .Sara is planning to take on a mortgage of $100 000 and believes she can afford monthly payments up to $700.How much interest would she save if she decided to pay off her mortgage over 20 years,rather than over 25 years? Her mortgage is at five percent interest calculated semi-annually.

• A)$42 000
• B)$18 120
• C)$34 896
• D)$16 776

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Definitions:

Categorical Proposition

A statement that asserts or denies something about an entire category of things, typically structured with a subject, predicate, and quantifier.

Traditional View

An approach or perspective that is based on long-established beliefs or practices within a society or culture.

Existential Import

The implication that a statement or proposition presupposes the existence of the entities it mentions.

Categorical Syllogism

A form of deductive reasoning consisting of three propositions: a major premise, a minor premise, and a conclusion, each containing a subject and a predicate.