Cassidy is planning to obtain a loan from her bank for $210,000 for a new home. The bank has approved Cassidy's loan at a fixed annual interest rate of 2.7% compounded monthly for 15 years. Use the formula to determine Cassidy's approximate monthly payment.
P = Fp(t)/1 - (1+t)^-n
Answer choices:
A. Cassidy’s approximate monthly payment will be $5,717.26
B. Cassidy’s approximate monthly payment will be $1,721.15
C. Cassidy’s approximate monthly payment will be $1,474.58
D. Cassidy’s approximate monthly payment will be $1,420.11

Cassidy's approximate monthly payment is $1420.11 if Cassidy is planning to obtain a loan from her bank for $210,000 for a new home option (D) is correct.

What is a loan amortization schedule?

It is defined as the systematic way of representing of loan payments according to the time in which the principal amount and interest are mentioned in a list manner

It is given that:

Cassidy is planning to obtain a loan from her bank for $210,000 for a new home.

A fixed annual interest rate of 2.7% compounded monthly for 15 years.

The formula is:

[tex]P=\rm \dfrac{Fp(i)}{1-(1+i)^{-1}}[/tex]

Plug all the values in the above formula:

[tex]P=\rm \dfrac{210000(2.7\%/12)}{1-(1+(2.7\%/12))^{-15\times12}}[/tex]

After calculating:

P = $1420.11

Thus, Cassidy's approximate monthly payment is $1420.11 if Cassidy is planning to obtain a loan from her bank for $210,000 for a new home.

Learn more about the amortization schedule here:

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