You are interested in buying a piece of real estate property that could be worth $450,000 in five years. If your earning interest rate is 5%, how much would you be willing to pay for this property now?

Your grandfather would like to share some of his fortune with you. He offers to give you money under one of the following scenarios (you get to choose): 1. $7,750 a year at the end of each of the next eight years 2. $48,350 (lump sum) now 3. $99,350 (lump sum) eight years from now Calculate the present value of each scenario using a 6% interest rate. Which scenario yields the highest present value? Would your preference change if you used a 12% interest rate? (Click the icon to view the present value annuity factor table.) factor table.) (Click the icon to view the future value annuity factor table.) factor table.) (Click the icon to view the present value (Click the icon to view the future value Using a 6% interest rate, calculate the present values for each scenario. (Round the amounts to the nearest dollar.) Present value of Scenario 1

Suppose you want to purchase a home for $525,000 with a 30-year mortgage at 4.84% interest. Suppose also that you can put down 30%. What are the monthly payments? (Round your answer to the nearest cent.) $ What is the total amount paid for principal and interest? (Round your answer to the nearest cent.) $ What is the amount saved if this home is financed for 15 years instead of for 30 years? (Round your answer to the nearest cent.)

You found your dream house. It will cost you $300000 and you will put down $40000 as a down payment. For the rest you get a 30-year 5.0% mortgage. What will be your monthly mortgage payment in $ (assume no early repayment)?.