Assume Your Current Mortgage Payment Is $900 Per Month

question 76

Multiple Choice

Assume your current mortgage payment is $900 per month.If you begin to pay $1,000 per month (with the extra $100 per month going to principal) ,which of the following will be TRUE?

• A)The mortgage balance will decrease faster with $1,000 monthly payment compared to $900 monthly payments.
• B)The total paid (principal and interest)will increase with $1,000 monthly payment compared to $900 monthly payments.
• C)The total interest expense will increase with $1,000 monthly payment compared to $900 monthly payments.
• D)The total principal paid will decrease with $1,000 monthly payment compared to $900 monthly payments.

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Definitions:

Profit Sharing Plan

A benefit plan where employees receive a portion of the company's profits, typically in the form of annual bonuses, aligning their interests with the financial success of the organization.

Piece Rate

A pay plan in which workers are paid a fixed sum for each unit of production completed.

Individual-Level

Pertaining to or focusing on actions, reactions, or impacts on a single person, as opposed to groups or organizations.

Merit Pay

A pay plan consisting of a pay rise which is linked directly to performance.