The Howe family recently bought a house.  The house has a 15…

The Howe family recently bought a house.  The house has a 15-year,  $249,865.00 mortgage with monthly payments and a nominal interest rate of 3.8 percent.  What is the total dollar amount of principal the family will pay  during the first 4 years of their mortgage?  (Assume that all  payments are made at the end of the month.)

Drongo Corporation’s 4-year bonds currently yield 4.8 percen…

Drongo Corporation’s 4-year bonds currently yield 4.8 percent and have an inflation premium  of 2.1%.  The real risk-free rate of interest, r*, is 2.1 percent and is assumed to be constant.   The maturity risk premium (MRP) is estimated to be 0.1%(t – 1), where t is equal to the time to  maturity.  The default risk and liquidity premiums for this company’s bonds total 0.3 percent and are believed to be the same for all bonds issued by this company.  If the average inflation  rate is expected to be 5.6 percent for years 5, 6, and 7, what is the yield on a 6-year bond for  Drongo Corporation?

A bank recently loaned you $14,440.00 to buy a car.  The loa…

A bank recently loaned you $14,440.00 to buy a car.  The loan is for 4 years  and is fully amortized.  The nominal rate on the loan is 11 percent, and payments are made at the end of each month.  What will be the remaining balance on the loan after you make payment number 35?