Calculating Loan Interest and Payments

Calculating Loan Interest and Payments

Assessment

Interactive Video

Mathematics

9th - 10th Grade

Hard

Created by

Thomas White

FREE Resource

Jane and Rick are buying a house for $220,233 in Mesa with a 5.14% APR mortgage. They plan a 9% down payment, reducing the loan amount to $200,412.03. The interest for the year is $10,301.18, and the daily interest is $28.22. Since they close on October 11th, they pay 20 days of prepaid interest, totaling $564.40.

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15 questions

Show all answers

1.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

What is the purchase price of the house Jane and Rick are buying?

$250,000

$200,412

$180,000

$220,233

2.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

What is the APR of the mortgage Jane and Rick have been approved for?

4.5%

3.75%

5.14%

6.0%

3.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

What percentage of the house price are Jane and Rick planning to pay as a down payment?

10%

15%

5%

9%

4.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

How much money do Jane and Rick need to borrow from the bank after the down payment?

$200,412.03

$220,233.00

$180,000.00

$210,000.00

5.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

Why do Jane and Rick not need to borrow the entire house price?

The bank offered a lower rate

They are making a down payment

They received a discount

They are paying in cash

6.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

What is the first step in calculating the interest rate for the loan?

Subtract the down payment from the house price

Convert the APR to a decimal

Multiply the borrowed amount by the APR

Divide the APR by 12

7.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

What is the interest amount for the year based on the borrowed amount?

$11,000.00

$9,500.00

$10,301.18

$8,750.00

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