Wally Bee purchased a new home for $500,000 with a $80,000 down payment. He financed the remainder with a 3% mortgage for 30 years. If Wally had originally planned on using a 15 year mortgage (also at 3%), how much would Wally save in interest expense compared to the 30 year mortgage? O $134,658 O $129,353 O $115,365 O $125,464

EBK CFIN
6th Edition
ISBN:9781337671743
Author:BESLEY
Publisher:BESLEY
Chapter4: Time Value Of Money
Section: Chapter Questions
Problem 25PROB
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Wally Bee purchased a new home for $500,000 with a $80,000 down payment. He financed the
remainder with a 3% mortgage for 30 years.
If Wally had originally planned on using a 15 year mortgage (also at 3%), how much would Wally
save in interest expense compared to the 30 year mortgage?
O $134,658
$129,353
O $115,365
$125,464
Transcribed Image Text:Wally Bee purchased a new home for $500,000 with a $80,000 down payment. He financed the remainder with a 3% mortgage for 30 years. If Wally had originally planned on using a 15 year mortgage (also at 3%), how much would Wally save in interest expense compared to the 30 year mortgage? O $134,658 $129,353 O $115,365 $125,464
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