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Principles of Microeconomics for AP® Courses
Calculate the equity each of these people has in his or her home:
a. Fred just bought a house for $200,000 by putting 10% as a down payment and borrowing the rest from the bank.
b. Freda bought a house for $150,000 in cash, but if she were to sell it now, it would sell for $250,000.
c. Frank bought a house for $100,000. He put 20% down and borrowed the rest from the bank. However, the value of the house has now increased to $160,000 and he has paid off $20,000 of the bank loan.