Consider the following loan. Complete parts (a)-(c) below. An individual borrowed $85,000 at an APR of 6%, which will be paid off with monthly payments of $581 for 22 years. a. Identify the amount borrowed, the annual interest rate, the number of payments per year, the loan term, and the payment amount. The amount borrowed is $[ ], the annual interest rate is [ ]%, the number of payments per year is [ ], the loan term is [ ] years, and the payment amount is $[ ]. b. How many total payments does the loan require? What is the total amount paid over the full term of the loan? There are [ ] payments toward the loan and the total amount paid is $[ ]. c. Of the total amount paid, what percentage is paid toward the principal and what percentage is paid for interest? The percentage paid toward the principal is [ ]% and the percentage paid for interest is [ ]%. (Round to the nearest tenth as needed.)
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The amount borrowed is $25,000. The annual interest rate is 6%. The number of payments per year is 12 (since payments are made monthly). The loan term is 22 years. The payment amount is $581. Show more…
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