A mortgage can take up to 25 years to pay off. Taking a $250,000 home, calculate the month-end payment for 15-, 20-, and 25-year periods using semi-annually compounded interest rates of 4%, 5.5%, and 7% for each period. What do you observe from your calculations?

a-1. Using semi-annually compounded interest rates of 4%, or 0.04, we have:

M15 = $2,389.13

M20 = $2,091.10

M25 = $1,929.54

a-2. Using semi-annually compounded interest rates of 5.5%, or 0.055

M15 = $2,841.49

M20 = $2,580.47

M25 = $2,450.28

a-3. Using semi-annually compounded interest rates of 7%, or 0.07

M15 = $3,329.35

M20 = $3,108.80

M25 = $3,009.40

b-1. It can be observed that there is a negative relationship between the month-end payment and the payment period.

b-2. It can be observed that there is a positive relationship between the month-end payment and the semi-annually compounded interest rate.

Step-by-step explanation:

The month-end payment for each period can be calculated using the formula for calculating the present value (PV) of an ordinary annuity as follows:

Mn = PV / ((1 - (1 / (1 + r))^n) / r) …………………………………. (1)

Where;

Mn = month-end payment for a particular year period = ?

PV = Present value or home value = $250,000

r = Monthly interest rate = semiannual interest rate / 6 months

n = number of months = Number of years * 12 months

Using equation (1), we have:

a. Calculate the month-end payment for 15-, 20-, and 25-year periods using semi-annually compounded interest rates of 4%, 5.5%, and 7% for each period.

a-1. Using semi-annually compounded interest rates of 4%, or 0.04

M15 = $250,000 / ((1 - (1 / (1 + (0.04/6)))^(15*12)) / (0.04 / 6)) = $2,389.13

M20 = $250,000 / ((1 - (1 / (1 + (0.04/6)))^(20*12)) / (0.04 / 6)) = $2,091.10

M25 = $250,000 / ((1 - (1 / (1 + (0.04/6)))^(25*12)) / (0.04 / 6)) = $1,929.54

a-2. Using semi-annually compounded interest rates of 5.5%, or 0.055

M15 = $250,000 / ((1 - (1 / (1 + (0.055/6)))^(15*12)) / (0.055 / 6)) = $2,841.49

M20 = $250,000 / ((1 - (1 / (1 + (0.055/6)))^(20*12)) / (0.055 / 6)) = $2,580.47

M25 = $250,000 / ((1 - (1 / (1 + (0.055/6)))^(25*12)) / (0.055 / 6)) = $2,450.28

a-3. Using semi-annually compounded interest rates of 7%, or 0.07

M15 = $250,000 / ((1 - (1 / (1 + (0.07/6)))^(15*12)) / (0.07 / 6)) = $3,329.35

M20 = $250,000 / ((1 - (1 / (1 + (0.07/6)))^(20*12)) / (0.07 / 6)) = $3,108.80

M25 = $250,000 / ((1 - (1 / (1 + (0.07/6)))^(25*12)) / (0.07 / 6)) = $3,009.40

b. What do you observe from your calculations?

Two things can be observed from the calculations:

b-1. At a particular semi-annually compounded interest rate, the month-end payment decreases as the payment period increases. This implies that there is a negative relationship between the month-end payment and the payment period.

b-2. At a particular payment period, the month-end payment increases as the semi-annually compounded interest rate increases. This implies that there is a positive relationship between the month-end payment and the semi-annually compounded interest rate.

step-by-step explanation:

1. practice, practice & more practice

2. review errors

3. master the key concepts

do not try to memorise the processes.

4. understand your doubts.

5. create a distraction free study environment

6. create a mathematical dictionary

7. apply maths to real world problems.

answer: the answer is simply nothing.

step-by-step explanation: because there is no ending to this question

gimme brainliest > : 3