P 435 - 436 New
P 435 - 436 New
ANSWERS
1' Read the quote at the beginning of this section. Interpret
what you have learned about discount points.
the quote in terms
' of 1. This is a tongue in cheek
quote. in effJct, it says that
See margin.
2' Determine the cost of the points and the new interest
rate for each
amount and interest rate. Assume each point costs 17o of
loan ir"r"ff"Y,T:i?J;!""'?J,n;t
the loan amounl. "
they can reap the benefits of
original APR 4.1%, i poiniwith al.2o/odiscount beins mortsage debt rree!
.a. 1199,000,
b. ilil, ;;;
original ApR 3.95%, i points with a 0.25o/od.iscount per
t?19,000, point $5,000; 3.4s%