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  3. 2. an arm is made for $50,000 for 30 years with th

2. An ARM is made for $50,000 for 30 years with the following terms Initial...

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2. An ARM is made for $50,000 for 30 years with the following terms Initial interest rate 1 percent Paymen Interest rate cap -none Discount points point Negative amortization is not allowed Index 1-year Treasuries Margin 200 basis points ts reset each year Payment cap-none Based on estimated forward rates, the 1-year Treasury yields to which the ARM is tied is forecasted as follows: Beginning of year (BOY) 2-one percent (1%); (BOY) 3-two percent (2%); (BOY) 4-35%; (BOY) 5-5% Compute the interest rate, monthly payments, and loan balances for each year for this unrestricted ARM, and the yield for the entire five-year period

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