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  3. a house can be purchased for ?$155 comma 000155,00

A house can be purchased for ?$155 comma 000155,000?, and you have ?$25 comma 00025,000 cash for a down...

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Question

Advance Math

A house can be purchased for

?$155 comma 000155,000?,

and you have

?$25 comma 00025,000

cash for a down payment. You are considering the following twofinancing? options:

bullet•

Option? 1. Getting a new standard mortgage with a

7.57.5?%

?(APR) interest and a

3030?-year

term.

bullet•

Option? 2. Assuming the? seller's old? mortgage, which has aninterest rate of

5.55.5?%

?(APR), a remaining term of

2525

years? (the original term was

3030

?years), a remaining balance of

?$97 comma 21797,217?,

and payments of

?$597597

per month. You can obtain a second mortgage for the remainingbalance

?($32 comma 78332,783?)

from your credit union at

99?%

?(APR) with a

1010?-year

repayment period.

?(a) What is the effective interest rate of the combined?mortgage?

The effective interest rate of the combined mortgage is

nothing?%.

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