monthly payment principal $174,900 term length 30 years interest rate 4% monthly payment $835 how much of…

monthly payment principal $174,900 term length 30 years interest rate 4% monthly payment $835 how much of the 81st payment will go toward interest if there is an outstanding principal of $151,840? interest on 81st payment = $? round to the nearest hundredth.

monthly payment principal $174,900 term length 30 years interest rate 4% monthly payment $835 how much of the 81st payment will go toward interest if there is an outstanding principal of $151,840? interest on 81st payment = $? round to the nearest hundredth.

Answer

Explanation:

Step1: Convert annual rate to monthly rate

The annual interest rate is 4% or 0.04. The monthly - interest rate $r$ is $\frac{0.04}{12}$.

Step2: Calculate interest for 81st payment

The interest portion of a loan payment is calculated by multiplying the outstanding principal $P$ by the monthly - interest rate. Here, $P = 151840$ and $r=\frac{0.04}{12}$. So the interest $I$ is $I = 151840\times\frac{0.04}{12}$. $I=\frac{151840\times0.04}{12}=\frac{6073.6}{12}\approx506.13$

Answer:

$506.13$