Real Estate Math
A Des Moines investment property is purchased for $400,000 with a 25% down payment. The annual interest rate on the mortgage is 7%. What is the first year's interest expense (interest only)?
A$21,000✓ Correct
B$28,000
C$7,000
D$100,000
Explanation
Down payment = $400,000 x 0.25 = $100,000.
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