math homework APR

Question

Rounding in the calculation of monthly interest rates is discouraged. Such rounding can lead to answers different from those presented here. For long-term loans, the differences may be pronounced.

You find that the going rate for a home mortgage with a term of 30 years is 6.5% APR. The lending agency says that based on your income, your monthly payment can be at most $740. How much can you borrow? (Round your answer to the nearest cent.)

$ 

Answer 1

p = r(V) / [1 - ( + r)^-n]

740 ≥ 0.035V / [1 - 1.035^-360]

740 ≥ 0.035V / [1 - 0.00000418286718]

21142.85714 ≥ V / 1.000004183

21149.94558 ≥ V