Question

Alice purchased a house using a fixed rate mortgage. The annual interest rate is 5.6% compounded monthly for 30 years. The mortgage amount is $205,000. What is the monthly payment on the mortgage?

$601.33

$1,176.86

$1,189.00

$1,271.15

Answer 1

@phi

Answer 2

@Mertsj

Answer 3

@TuringTest

Answer 4

@e.mccormick

Answer 5

@golfergirl93

Answer 6

\[M=P\frac{i(1+i)^n}{(1+i)^n-1}\]

Answer 7

P= principal
i = interest rate
n = number of payments

Answer 8

and what would that give you cause m not getting the correct answer

Answer 9

@Mertsj

Answer 10

@zimmah

Answer 11

@Zale101

Answer 12

@charlotte123

Answer 13

@wolfe8

Answer 14

I know I am a tad late. But for anyone else who may need it
\[M = P [ i(1 + i)^n ] / [ (1 + i)^n - 1]\]
Would be the formula like @mertsj said. I believe when you said you got the wrong answer, you did not divide the interest rate by 12 since you were given the annual interest.
Here is my work:
P = 205,000
i = .056/12 = 0.00466666666 (since you were given the annual interest and we need the monthly payment)
n = 30*12 = 360 (since you were given the years and you need the months)

M = 205,000 [ 0.00466666666(1 + 0.00466666666)^360 ] / [ (1 + 0.00466666666)^360 - 1]

M = 205,000 [ 0.00466666666(1.00466666666)^360 ] / [ (1.00466666666)^360 - 1]

M = 205,000 [ 0.00466666666(5.34462910282) ] / [ (5.34462910282) - 1]

M = 205,000 [.02494160244] / [4.34462910282]

M = 205,000 [.0057407898]

M = $1,176.86