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A Homeowner Can Obtain a $250,000,30-Year Fixed-Rate Mortgage at a Rate

Question 8

Multiple Choice

A homeowner can obtain a $250,000,30-year fixed-rate mortgage at a rate of 6.0 percent with zero points or at a rate of 5.5 percent with 2.25 points.
If you will keep the mortgage for 30 years,what is the net present value of paying the points (to the nearest dollar) ?


A) $9,475
B) $8,360
C) $7,564
D) $7,222
E) $6,578

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