Chapter 17: Activities 510
Computing and Graphing Mortgage Payments
Computing and Graphing Mortgage PaymentsComputing and Graphing Mortgage Payments
Computing and Graphing Mortgage Payments
Problem
ProblemProblem
Problem
You are a loan officer at a mortgage company, and you recently closed on a 30-year
home mortgage at 8 percent interest with monthly payments of 800. The new home
owners want to know how much will be applied to the interest and how much will be
applied to the principal when they make the 240th payment 20 years from now.
Procedure
ProcedureProcedure
Procedure
1. Press z and set the fixed-decimal mode to
2 decimal places. Set the other mode
settings to the defaults.
2. Press Œ Í Í to display the
TVM Solver. Enter these values.
Note: Enter a positive number (800) to show PMT as a cash inflow. Payment values
will be displayed as positive numbers on the graph. Enter
0 for FV, since the future
value of a loan is 0 once it is paid in full. Enter
PMT: END, since payment is due at the
end of a period.
3. Move the cursor onto the
PV= prompt, and then press ƒ \. The present
value, or mortgage amount, of the house is displayed at the
PV= prompt.
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