A mortgage company offers a loan for 30 years at an annual rate that is equal to the prime rate published by
the Federal Reserve plus 2%. This can be modeled
using the function APR(P) = p + 0.02, where p is the
prime interest rate as a decimal. The annual interest
rate is then converted to a monthly interest rate using
the function (APR) =
APR
The Wilsons want to borrow
12
$128,000. Their monthly payments can be calculated
128,000r
by the function m(r) =
1-(1 + r)-360