SOA Exam FM Sample Question 407
Study guide: Exam FM-2
A person borrows 150,000 to purchase a house. The borrower makes interest-only payments at the end of each month for five years, then makes payments of 1000 at the end of each month.
Interest accrues at a nominal annual rate of 4% convertible monthly for the first five years and then at a nominal annual rate of 6% convertible monthly.
Determine the total number of payments it will take to repay the loan.
- A) 209
- B) 269
- C) 278
- D) 329
- E) 338
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